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Notice that these values correspond to a case in which the volatility in the price of gold is higher than in the lecture notes. The
Notice that these values correspond to a case in which the volatility in the price of gold is higher than in the lecture notes. The discount rate is still 5%, and the cost of opening the mine is still 70 as in the lecture notes. The NPV of waiting to open the mine tomorrow is now
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Microeconomics
Authors: Michael Parkin
11th edition
133019942, 978-0133020250, 133020258, 978-0133019940
