Which One of the Following Is an Example of a "Flexibility

question 38

Multiple Choice

Which one of the following is an example of a "flexibility" option?

• A) A company has an option to invest in a project today or to wait for a year before making the commitment.
• B) A company has an option to close down an operation if it turns out to be unprofitable.
• C) A company agrees to pay more to build a plant in order to be able to change the plant's inputs and/or outputs at a later date if conditions change.
• D) A company invests in a project today to gain knowledge that may enable it to expand into different markets at a later date.
• E) A company invests in a jet aircraft so that its CEO,who must travel frequently,can arrive for distant meetings feeling less tired than if he had to fly a commercial airline.

---

Definitions:

International Repercussions

The global effects or consequences that result from an event or action occurring in a particular country or region.

Charles I

King of England, Scotland, and Ireland from 1625 until his execution in 1649, whose reign was marked by religious and constitutional conflicts leading to the English Civil War.

Constitutional Crisis

A situation that arises when there is a serious disagreement about the interpretation or application of a constitution, leading to a standoff between different branches of government or levels of authority.

Charles I

A 17th-century king of England, Scotland, and Ireland, whose conflicts with parliament led to the English Civil War and ultimately his execution in 1649.