Which of the following are examples of applications of real options analysis?
I.a strategic investment in the computer business;
II.the valuation of an aircraft purchase option;
III.the option to develop commercial real estate;
IV.the decision to mothball an oil tanker
A)I only
B)I and II only
C)I, II, and III only
D)I, II, III, and IV

Question

Quizplus · Accepted Answer

Real options analysis is used to evaluate the value of making strategic investments under uncertainty, such as entering a new business (I), valuing options in financial contracts (II), deciding on developing real estate based on market conditions (III), and the decision to temporarily cease the operation of assets like an oil tanker in response to market conditions (IV).

Which of the Following Are Examples of Applications of Real