@article{Hartwick:275197, recid = {275197}, author = {Hartwick, John M.}, title = {Option Pricing by the Nonrenewable Resource Extracting Firm Facing Output Price Uncertainty}, address = {1985}, number = {2118-2018-4609}, series = {IER No. 590}, pages = {24}, year = {1985}, abstract = {We establish a general preference for price uncertainty by the pricetaking, risk neutral, nonrenewable resource extracting firm with orthodox convex extraction costs. Option prices for delivery of a ton at a particular date in the future exceed the expected dollar return from the purchase of the option. The dependence of option price on initial stock size takes a simple form. Other comparative static results are reported.}, url = {http://ageconsearch.umn.edu/record/275197}, doi = {https://doi.org/10.22004/ag.econ.275197}, }