Long run value stabilization in a real options perspective

Andrea Mantovi ()

No 2009-EP01, Economics Department Working Papers from Department of Economics, Parma University (Italy)

Abstract: The present value of growth opportunities with stable long run value and decreasing investment cost is addressed in a real options perspective. The model is solved in terms of closed form solutions, and a duality between elementary real options of waiting to invest is conjectured to be a fundamental structure of a forthcoming theory of real options. A pure capital budgeting perspective is pursued. Natural lines for future research are accounted for.

Keywords: PVGO; real options; strategic investment; learning (search for similar items in EconPapers)
JEL-codes: D92 (search for similar items in EconPapers)
Pages: 15
Date: 2009
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Persistent link: https://EconPapers.repec.org/RePEc:par:dipeco:2009-ep01

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