Compute the call

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Question - Let $S be the current gate fee for a WTE project. If the government provides a call option to build another WTE plant at gate fee $2S when the current plant is handed over at the end of 10 years, compute the call as a % of S. Given: Volatility = 0.2, time to expiry = 10 years, risk-free interest rate = 3%.

Reference no: EM133177458

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