Amazon Prime Is Credited for Helping to Increase the Amazon

question 96

Multiple Choice

Amazon Prime is credited for helping to increase the Amazon stock price by nearly 300 percent from 2008 to 2010.This competitive advantage is known as

• A) causal ambiguity.
• B) product rarity.
• C) service validity.
• D) substitutability.

Assess how real options influence the risk and size of project cash flows.

Identify different types of real options, such as the option to expand, abandon, or delay a project.

Analyze the effect of timing decisions on project value and risk.

Explain the relationship between real option valuation and project risk management.

---

Definitions:

Derived Demand

Demand for a commodity, service, etc., that is a consequence of the demand for something else.

Inputs Demand

The requirement for resources and materials necessary to produce goods and services in an economy.

Secondary Demand

The desire for products and services that derive from the demand for another product or service.

Derived Demand

The demand for a good, service, or factor of production resulting from the demand for another good or service.