Which of the following is a characteristic of a real option?
a. The call option on a stock exercised if some average of the prices of its components passes a critical level.
b. The right to postpone construction on the basis of net present value calculation.
c. The put option on a stock that need to be paid for (at a predetermined price) if they are actually exercised.
d. The right to sell an option at the strike price.
B
You might also like to view...
All of the following will affect the position of the demand curve EXCEPT
A) income. B) taste and preference. C) changes in expectations of future relative prices. D) prices of resources used to produce the product.
Compare and contrast the four market models in terms of the profit-maximizing output level for each, the shut-down rule for each, the probability of long-run economic profits being earned, and their social desirability
For a given increase in price, the greater is the elasticity of supply, the greater is the resulting a. decrease in quantity supplied. b. decrease in supply
c. increase in quantity supplied. d. increase in supply.
Based on the graph showing the effective federal funds rate, in what context did the downturn in interest rates after the 2001 recession occur?
a. Interest rates were higher than they were at the start of previous downturns.
b. Interest rates were lower than they were at the start of previous downturns.
c. Interest rates were at an all-time low before the start of the downturn.
d. Interest rates were at an all-time high before the start of the downturn.