Intermediate Microeconomics and Its Application 12th Edition by Walter Nicholson,Christopher Snyder

Exercise 29

College students are familiar with the real option of being able to drop a course before the end of the term. The text provided a list of factors affecting the value of any option (value of underlying opportunity, variation in the situation, duration, price). What is meant by each one of these factors in the context of the decision to drop a course? How do the factors affect the value of this option? Given that options are valuable, how ould explain why some colleges put certain limits on the ability of students to drop courses?