Ignoring the Option to Expand

question 35

Multiple Choice

Ignoring the option to expand:

• A)overestimates the internal rate of return on a project
• B)underestimates the net present value of a project
• C)ignores the possibility that a negative net present value project might be positive given changes over time
• D)ignores the possibility that one variable is the primary source of the forecasting risk associated with a project
• E)ignores the value of discontinuing a project early

---

Definitions:

Freudian Psychologist

A psychologist who follows the theories of Sigmund Freud, focusing on unconscious processes, childhood experiences, and psychosexual development.

Strong Superego

A strong superego refers to an aspect of a person's personality that acts as a moralizing force, often being critical and enforcing the moral standards learned from parents and society.

Studies

Systematic investigations intended to establish facts, acquire knowledge, or reach new conclusions through research and analysis.

Defense Mechanisms

In psychoanalytic theory, the ego’s protective methods of reducing anxiety by unconsciously distorting reality.