Question
Which of the following statements correctly describes characteristics associated with real options? (a) When the value of a project is mainly linked to future growth
Which of the following statements correctly describes characteristics associated with real options?
(a) When the value of a project is mainly linked to future growth opportunities, real options become more important.
(b) Firms that absorb losses before abandoning negative NPV projects provide evidence consistent with real options being used as a decision-making tool.
(c) Managerial flexibility will always have significant value even when the firm has no uncertainty about future outcomes.
(d) More than one of the other statements are correct.
(e) None of the other statements is correct
The answer is (d) but which statements are correct?
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