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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Quick query on the recent article published on real options
Hi
I have a very quick query on the recent article published on real options
In the section for option to delay, the discounting of the cash flows is delayed and calculated as from year 3 onwards
However a similar question appeared in 6/12 (Q1) where the discounting of the cash flows was not delayed but rather totalled up from 1-5 and used as the price of the option
Can you please tell me why there is a difference ?
No – there is not a difference.
The PV of the cash flows was given in the question as the PV (now) for the flows from 3 to 7.