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    What is a real option? What is a financial option? What is the single most important characteristic of an option?

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    Mini Case a & c Pages 614-615

    a. What is a real option? What is a financial option? What is the single most important characteristic of an option?

    c. Consider Tropical Sweets' call option with a $25 strike price. The following table contains historical values for this option at different stock prices:

    Stock Price Call Option Price
    $25 $3.00
    30 7.50
    35 12.00
    40 16.50
    45 21.00
    50 25.50

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    a. What is a real option? What is a financial option? What is the single most important characteristic of an option?

    An option is a contract that gives its holder the right to sell (or buy) an asset at some predetermined price within a specified period of time. The most important characteristic of an ...

    Solution Summary

    Instruction on the concepts and then the computation for you.

    $2.19

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