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<p>The rental consists of an essentially deterministic part (the school months) and an embedded option (the summer months).</p>
<p>My point was that in most circumstances it’s irrational to price that option at zero.</p>
<p>Most likely the unit has some value for one or both parties in the summer, and they can reach a better deal by taking that into account.
How big a financial difference that might make, can vary. But it can be substantial enough to at least think about it when drawing up
the contract.</p>