Assume the following information. A golf course currently produces net cash inflows of $1m per year with a required return of 30%. The standard deviation of the golf course inflows is estimated at 30%. A developer has offered the golf course owner $14m which is open for the next year. The risk free rate is currently 3% pa. Use a Black Scholes approach to value the option. What are some of the shortcomings of the approach used ?