Which One of the Following Will NOT Increase the Value

question 28

Multiple Choice

Which one of the following will NOT increase the value of a real option?

• A) Lengthening the time during which a real option must be exercised.
• B) An increase in the volatility of the underlying source of risk.
• C) An increase in the risk-free rate.
• D) An increase in the cost of obtaining the real option.
• E) A decrease in the probability that a competitor will enter the market of the project in question.

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Definitions:

Performance Orientation

An aspect of organizational culture focusing on outcomes and results, emphasizing the achievement of goals and standards of excellence.

External Locus

A belief system where individuals perceive their successes or failures to be the result of external forces or the environment.

Control

The ability to direct, manage, or govern over oneself, other people, or situations to achieve a desired outcome.

Social Intelligence

The skill of comprehending and handling the nuances and interactions within personal connections efficiently.