Managers Who Hold Real Options Can View

question 26

Multiple Choice

Managers who hold real options can view:

• A) themselves as passive onlookers with no decision making opportunities.
• B) these as tools for reducing the total risk of the firm through diversification.
• C) these as opportunities to alter management decisions in the future.
• D) themselves as agents who are looking for higher compensation.

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Definitions:

Public Good

A good that is non-excludable and non-rivalrous, meaning individuals cannot be effectively excluded from its use and one person's use does not reduce availability to others.

Grocery Store

A retail store that sells food and other household goods.

Marginal Social Benefit

The additional benefit to society as a whole from one more unit of a good or service being consumed.

Marginal Private Benefit

The additional benefit or satisfaction received by a consumer or producer from consuming or producing one more unit of a good or service.