Intel uses a forecasting model for potential demand for its chip designs in which they calculate the likelihood of a range of potential demand levels and they established a computer simulation of a production plant.From these models,they gather the information to identify what equipment they definitely will need to order.This helps with pricing as well.What kind of investment analysis tool are they using?
A) inventory analysis
B) financial analysis
C) real options analysis
D) break-even analysis

Question

Quizplus · Accepted Answer

Real options analysis (ROA) an investment analysis tool that looks at an investment or activity as a series of sequential steps, and for each step the investor has the option of (a) investing additional funds to grow or accelerate, (b) delaying, (c) shrinking the scale of, or (d) abandoning the activity. Intel uses real option analysis to limit the risks there are inherent in managing the complex and dynamic semiconductor business.

Intel Uses a Forecasting Model for Potential Demand for Its