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The option is analysed using the binomial decision tree.
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Using the binomial expansion for we obtain (A2).
Again, using the binomial expansion for we obtain (A5).
However, the results of considering managerial flexibility using the binomial model show that the uncertainty generates value for the project.
Consequently, using the binomial expansion, we can obtain the CDF of (gamma _{min {mathcal {R}}}).
where (38) is obtained by using the binomial theorem and the help of (19).
We therefore modeled the data using the Binomial distribution.
These P-values are computed using the binomial distribution.
The first two hypotheses were tested using the binomial sign test.
For each hypothesis a likelihood is calculated based on the observed data using the binomial distribution.
CIs were estimated using the binomial exact.
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