Abstract
The contribution of the Black-Scholes Model (BSM, 1973; Merton, 1973) to the field of finance has been enormous. There are a number of extensions to the model (see Haug, 2007) to allow it to be applied to options on securities other than stocks that do not pay dividends. However, although the BSM has been applied to perform real option analysis, it does not work very well for valuing real options.
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References
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© 2014 Tom Arnold
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Arnold, T. (2014). Real Option Analysis and the Black-Scholes Model. In: A Pragmatic Guide to Real Options. Palgrave Macmillan, New York. https://doi.org/10.1057/9781137391162_8
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DOI: https://doi.org/10.1057/9781137391162_8
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