The two main categories of real options are growth options and flexibility options.Which of the following investments is not a growth option?
A)Ford's acquisition of programmable robots that allow different models of car to be produced on a single assembly line
B)Facebook's acquisition of WhatsApp 2014
C)Apple's program of research into virtual reality
D)Callaway Golf's strategic alliance with Automobili Lamborghini to develop new composite materials

Question

Quizplus · Accepted Answer

Growth options are investments that allow a company to expand its business, enter new markets, or launch new products. Ford's acquisition of programmable robots is a flexibility option, not a growth option, because it allows Ford to be more flexible in its production processes rather than directly contributing to growth through new markets or products.

The Two Main Categories of Real Options Are Growth Options