Why is simulation preferred over scenario analysis for valuing real options embedded in new ventures?

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Entrepreneurial Finance Strategy, Valuation, And Deal Structure

ISBN: 9780804770910

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Authors: Janet Smith, Richard Smith, Richard Bliss

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Question Posted: Apr 30, 2024 01:02 AM

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Why is simulation preferred over scenario analysis for valuing real options embedded in new ventures?

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Simulation is often preferred over scenario analysis for valuing real options embedded in new ventures due to several key advantages Incorporation of Uncertainty and Complexity Simulation allows for t...View the full answer

Entrepreneurial Finance Strategy, Valuation, And Deal Structure

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