Unfortunately we do not have an option pricing model

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Unfortunately, we do not have an option pricing model for all options, so we cannot always get the "value of options" to use in an equation. However, it is important to understand that the lack of a convenient option pricing model does not diminish the importance of an option. Managerial options have been shown to have substantial value. For example, consider mineral mining operations. A mining firm has the option to suspend mining operations during times when the price of the mineral is too low to make extraction profitable. The firm can then restart operations whenever mineral prices rise and extraction becomes profitable again. This option substantially increases the value of the mine.
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