Bond holders and equity holders claims to the cash flows of a limited liability firm can be viewed from a real options perspective. Effectively,...

a.

both bond holders and equity holders hold options on the firms assets with the strike price equal to the book value of equity.

b.

equity holders have a long put option on the firms assets.

c.

bond holders have a short call option on the firms assets.

d.

None of the statements about real options is correct.

e.

All of the statements about real options are true.