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Return to the Sport Hotel project that was introduced in Topic 6 of the course notes and also in Chapter 9 on real options. Consider

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Return to the Sport Hotel project that was introduced in Topic 6 of the course notes and also in Chapter 9 on real options. Consider the original data as was given in the problem (please refer to either your textbook or the course notes should you need to be reminded of these data). Suppose that everything is the same as in that original set-up example except two things: (1) the probability that the city will be awarded the franchise, p, is equal to 42% and (2) the value of the hotel, should the city be awarded the franchise, is not $8,000,000 but is instead $6,500,000. Given these two changes, and incorporating the real option into the analysis, which f the following is closest to the project's NPV? A. NPV -$100,000 B. NPV = $50,000 C. NPV = $1,000,000 D. -$1,000,000 E. NPV = $100,000 Return to the Sport Hotel project that was introduced in Topic 6 of the course notes and also in Chapter 9 on real options. Consider the original data as was given in the problem (please refer to either your textbook or the course notes should you need to be reminded of these data). Suppose that everything is the same as in that original set-up example except two things: (1) the probability that the city will be awarded the franchise, p, is equal to 42% and (2) the value of the hotel, should the city be awarded the franchise, is not $8,000,000 but is instead $6,500,000. Given these two changes, and incorporating the real option into the analysis, which f the following is closest to the project's NPV? A. NPV -$100,000 B. NPV = $50,000 C. NPV = $1,000,000 D. -$1,000,000 E. NPV = $100,000

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