Artempts 0.81.5 Keep the Highest 1.5/3 9. Real options Projects are afso often embedded with different optens that can help making decisons under incertainty. There are techniques used to exaluate theie embedded options which are caled real options. The models used to value these options are based on the type of the real option avalable for the project. True or false; A real option embedded in a capital project gves the investing firm the right but not the obligaton to buy, sel, or trander an arset at a met price during a specfied period of time. O True 0 False The managers of Langngham Padway Co, have included an expansion eption into the design of a proposed capital mvestinent project 1. This option allows the outputs of the production process to be altered if market conditions change duing a projects lfe. II. This option alows a project to be expanded if dernand tums out to be greater than expected. II. This option allows the inputs in the production process to be altered if market conditons change durny a project's ife. IV. This option alows a firm to temporarly terminate operations in order to prevent experiencing negatwe cash flows Which of the listed statements best describes an expansion option? Statement II stitement! Statement III sthtement N None of the statements isted above describes an expansion option Reat option analysis adds value to a project when it is used for which of the following? check all that apaily. Modfying the way that decision makers perceive fiexblity in capital budgeting actovities Expanding the way that managers view risk and uncertainty, seeng them as phenomena to be apprecuefed and ecploted father than feored and avoided Identifying real options that can be sold in the financial markets Makingrmangagriat decision making less delberote and analyocial Artempts 0.81.5 Keep the Highest 1.5/3 9. Real options Projects are afso often embedded with different optens that can help making decisons under incertainty. There are techniques used to exaluate theie embedded options which are caled real options. The models used to value these options are based on the type of the real option avalable for the project. True or false; A real option embedded in a capital project gves the investing firm the right but not the obligaton to buy, sel, or trander an arset at a met price during a specfied period of time. O True 0 False The managers of Langngham Padway Co, have included an expansion eption into the design of a proposed capital mvestinent project 1. This option allows the outputs of the production process to be altered if market conditions change duing a projects lfe. II. This option alows a project to be expanded if dernand tums out to be greater than expected. II. This option allows the inputs in the production process to be altered if market conditons change durny a project's ife. IV. This option alows a firm to temporarly terminate operations in order to prevent experiencing negatwe cash flows Which of the listed statements best describes an expansion option? Statement II stitement! Statement III sthtement N None of the statements isted above describes an expansion option Reat option analysis adds value to a project when it is used for which of the following? check all that apaily. Modfying the way that decision makers perceive fiexblity in capital budgeting actovities Expanding the way that managers view risk and uncertainty, seeng them as phenomena to be apprecuefed and ecploted father than feored and avoided Identifying real options that can be sold in the financial markets Makingrmangagriat decision making less delberote and analyocial