Use the Information for the Question(s)below

question 31

Multiple Choice

Use the information for the question(s) below.
You own a small manufacturing plant that currently generates revenues of $2 million per year.Next year,based upon a decision on a long-term government contract,your revenues will either increase by 20% or decrease by 25%,with equal probability,and stay at that level as long as you operate the plant.Other costs run $1.6 million per year.You can sell the plant at any time to a large conglomerate for $5 million and your cost of capital is 10%.
-Given the embedded option to sell the plant,the value of your plant will be closest to:

• A)$5.0 million.
• B)$4.0 million.
• C)$6.5 million.
• D)$8.0 million.

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Definitions:

Emotional Intelligence

The capacity to be aware of, control, and express one's emotions, and to handle interpersonal relationships judiciously and empathetically.

Identify Emotions

The process of recognizing and naming the emotions being experienced by oneself or observed in others.

Regulate Emotions

The process of recognizing, understanding, and managing one's emotional responses to effectively respond to life's challenges.

Sensory Modalities

Different forms of sensory perceptions, such as sight, sound, touch, taste, and smell, through which humans and animals perceive the environment.