If a project has a positive NPV, then the real options that are relevant to the project are not important to estimating the value of the project.

Question

Quizplus · Accepted Answer

If a project has a positive NPV, it still may be valuable to consider real options that could increase the value of the project even further. Real options refer to additional opportunities or choices that a project may have in the future, such as expanding the project, delaying it, or abandoning it if necessary. Considering these options can often lead to a more accurate estimation of the project's value and help managers make better decisions. Therefore, real options should be taken into account even if the NPV is positive.

If a Project Has a Positive NPV, Then the Real