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elf_fu elf_fu
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6 years ago
The price of oil is $120 per barrel. The effective lease rate and risk free rate are 5.0% and 6.0%, respectively. The constant cost of extraction is $105 per barrel and the volatility of prices is 18.0%. What is the value of an option to defer extraction?
A) $30.68
B) $32.08
C) $34.56
D) $38.34
Textbook 
Derivatives Markets

Derivatives Markets


Edition: 3rd
Author:
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phuongha2892phuongha2892
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#1
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6 years ago
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elf_fu Author
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6 years ago
Thank you, thank you, thank you!
courtneyrmcd
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Yesterday
this is exactly what I needed
nsak
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2 hours ago
Smart ... Thanks!
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