The opportunity to take action that will either maximize the upside of limit the downside of a capital investment is referred to as ________.
A) net present value
B) a real option
C) a learning option
D) a value option

Question

Quizplus · Accepted Answer

A real option refers to the opportunity to take actions that will either maximize the upside of limit the downside of a capital investment. It allows flexibility in decision-making and can lead to greater returns on investment. A, C, and D are not accurate definitions of real options.

The Opportunity to Take Action That Will Either Maximize the Upside