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

Question

Quizplus · Accepted Answer

Managers who hold real options should view them as opportunities to alter management decisions in the future. Real options allow managers to make strategic decisions that can create value for the firm. By recognizing these opportunities, managers can make informed decisions that can lead to increased profitability and growth. Viewing real options as tools for reducing risk or as passive onlookers with no decision making opportunities is not accurate.

Managers Who Hold Real Options Should View