A wildcat oil driller has enough capital to invest in only one project, that is, to drill one well in an
East Texas oil field. A major oil company is drilling 100 wells in the same field.
The probability of
successfully striking oil is 10% for any well drilled in this field. Which of the following statements
is MOST correct concerning the risk involved in these capital budgeting projects?
A) The risk for the wildcat driller is the same as the risk for the major oil company since they are
both drilling in the same oil field.
B) The best measure of risk for the wildcat oil driller is project standing alone risk.
C) The appropriate risk for the wildcat driller is systematic risk.
D) The appropriate risk for the major oil company is contribution-to-firm risk, if all
shareholders of the firm are well diversified.
B
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Which of the following statements is true of the principle of first in time equals first in right regarding trademark rights in the United States?
A. It is based on the priority of its use in any other country. B. It is enough to have registered the mark first. C. It is enough to have invented the mark first. D. It is bound by the territoriality principle.
Jackie's parents loaned her $80,000 to fund her college education. Her parents are not charging interest. They desire to be paid one lump sum of $80,000 when Jackie can accumulate that amount. Jackie established a savings plan that earns 8% compounded annually. Her new job promises to pay an annual holiday bonus that will enable her to make equal annual, year-end deposits of $6,400. Approximately
how many years will it take Jackie to accumulate the $80,000? A) 8 years B) 8.5 years C) 9 years D) 12.5 years
Evelyn's vacuum is at the ________ stage of the product life cycle
A) product development B) introduction C) growth D) decline E) maturity
According to the text, companies controlled by other companies, but less-than-majority owners may exercise control by a variety of means, both those involving stock ownership and those involving nonownership mechanisms, are known as:
A. international companies. B. virtual organizations. C. affiliates. D. networked organizations. E. subsidiaries.