Published on Apr 24, 2017
We started this session by looked at undeveloped natural resource reserves as options, with the premium a function of the volatility in oil prices. We then moved on to the option to expand and how it can add to the value of some companies with exclusive assets (like Facebook’s user base) and ended with the option to abandon, the option to walk away from your mistakes. All three have value and we will continue our real option discussion (and conclude it) in the next session.
Slides: http://www.stern.nyu.edu/~adamodar/po…
Post class test: http://www.stern.nyu.edu/~adamodar/pd…
Post class test solution: http://www.stern.nyu.edu/~adamodar/pd…
