| VALUING AN OPTION TO DELAY A PROJECT |
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| This program calculates the value of the option to delay making an investment. |
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Inputs relating the underlying asset |
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Enter the present value of cash flows from investing in project now = |
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$350.00 |
(in currency) |
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Entet the annualized standard deviation in ln(present value of CF) |
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22.36% |
(in %) |
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Enter the initial investment needed to take project (in PV $) = |
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$500.00 |
(in currency) |
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Enter the number of years you have rights to project |
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20 |
(in years) |
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General Inputs |
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Enter the riskless rate that corresponds to the option lifetime = |
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7.00% |
(in %) |
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| Output |
| Stock Price= |
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$350.00 |
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T.Bond rate= |
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7.00% |
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| Strike Price= |
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$500.00 |
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Variance= |
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0.05 |
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| Expiration (in years) = |
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20 |
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Annualized dividend yield= |
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5.00% |
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d1 = |
0.54 |
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N(d1) = |
#NAME? |
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d2 = |
-0.46 |
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N(d2) = |
#NAME? |
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| Value of Option to Delay = |
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#NAME? |
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