Installing Crystal Ball Monte Carlo Simulation Software.

Installing Real Options Analysis Toolkit Software.

CHAPTER 2: GETTING STARTED WITH THE SOFTWARE.

Getting Started with Crystal Ball Software.

Getting Started with Real Options Analysis Toolkit Software.

 CHAPTER 3: FRAMING REAL OPTIONS.

Step 1. Qualify List of Projects and Strategies.

Step 2. Forecast Base-Case Variables for Each Project.

Step 3. Create Static DCF Models for Each Case.

Step 4. Monte Carlo Simulation—DCF Outputs Become Real Options Inputs.

Step 5. Framing the Real Options.

Step 6. Options Analytics, Simulation, and Optimization.

Step 7. Reports, Presentations, and Update Analysis. 

 CHAPTER 4: THE BASICS OF FINANCIAL MODELING.

Financial Analysis.

Monte Carlo Simulation.

Volatility Estimates.

CHAPTER 5: THE BASICS OF REAL OPTIONS.

Binomial Lattices.

Granularities in Lattices.

State-Pricing Approach to Solving a European Option.

Trinomial Lattices and American Options.

CHAPTER 6: REAL OPTIONS BUSINESS CASES.

Option to Abandon.

Option to Expand.

Option to Contract.

Option to Choose.

Compound Options.

Closed-Form Compound Options.

Sequential Compound Option.

Changing Costs.

Changing Volatility.

Option to Contract and Abandon.

Basic Black-Scholes with Dividends.

Barrier Options.

Stochastic Timing Options.

Switching Option.

Closed-Form Equations and Binomial Convergence.

Nonrecombining Lattices.

CHAPTER 7: EXTENDED PROBLEMS: COMBINING FORECASTING, DCF MODELING, REAL OPTIONS, AND OPTIMIZATION.

CHAPTER 8: EXERCISE SOLUTIONS.

CHAPTER 9: REAL OPTIONS ANALYSIS TOOLKIT SOFTWARE FUNCTION DESCRIPTION FOR EXCEL.

CHAPTER 10: REAL OPTIONS TABLES.

Real Options Value Tables.

Implied Volatility Tables.

Dividend Impact Tables.

APPENDIX.

CASE STUDIES.

More, Faster, Cheaper—The Siren Call of Upstream R&D.

Real Options Analysis Applied to Valuing Start-Up Entities: The Digital News, Inc.

About the CD-ROM.

Index.