In real options, required investment is considered the exercise price.

Name: In real options, required investment is considered the exercise price.
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In real options analysis, the required investment (also known as the cost of investment) is often considered the exercise price, since it represents the cost of taking advantage of the opportunity. The underlying asset or project is then considered the underlying security, and the option value represents the potential upside of the investment.

In Real Options, Required Investment Is Considered the Exercise Price