Real Options

Good morning Sir

in doing these questions, the trick is to get the right Pa, assuming we know the following:

1. for delay options, bsop gives the overall value
2. for expand option, bsop gives the value of the option
3. for abandon option, the bsop gives the value of the option.

so….Pa is where the examiner plays tricks on u. i wd like to know if my thinking below is correct:

Pa represents the present value of the cash flows which result due to the option under discussion. so, the question may give the value of Pa as a future value, which we wd have to convert to a present value or give future NPVs from which we compute future Pa, whcih are then discounted to present values.

is there any cheat sheet that can be developed for ensuring Pa is correct?

regards