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Sloan [31]
3 years ago
14

5. Introduction to real options Consider the following statement about real options: Sometimes real options can give managers th

e flexibility to decide to invest in a project or wait to make a more calculated decision. True or False: The preceding statement is correct. True False Which type of real option allows the output and/or inputs in the production process to be altered, depending on how market conditions change during a project’s life? Abandonment option Timing option Flexibility option Expansion option Consider the following example: Smoltz Motors has plants around the country that specialize in specific models of cars. Smoltz has determined that lower demand has led the firm’s inventory of SUVs to be too high. Smoltz wants to stop production for its SUVs and focus on its sedans. This example describes a real option to .
Business
1 answer:
klasskru [66]3 years ago
4 0

Answer and Explanation:

The given statement is true as the real options would provide the managers the flexibility for deciding to invest or wait so that it would make a more computed decision

The real option that permits the input or output in the production process that could vary so it would be investment timing option as here the timing plays a very vital role

The given situation represent a real option to expand as the firm would pursue the extra expansion contracts

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. The current spot exchange rate is $1.50/€ and the three-month forward rate is $1.55/€. Based on your analysis of the exchange
Andre45 [30]

Answer:

B) Buy €1,000,000 forward for $1.55/€.

Explanation:

To calculate the expected profit consider the following data and formula:

Amount in actions: 1.000.000

Spot exchange rate: 1.62

Three month forward calculation: 1.55

Expected profit=1,000, 000 *( 1.62 - 1.55) = 70,000.00.

6 0
4 years ago
According to the heckscher-ohlin theorem, trade arises are due to
Dominik [7]
<span>According to the heckscher-ohlin theorem, trade arises are due to </span><span> Differences in relative factor endowments and intensities.
</span><span> Differences in relative factor endowments and intensities will create a different in prices between one nation and another. This difference will create a leverage for each nation to trade with one another in order to use their resource more efficiently.</span>
5 0
3 years ago
Sylvia mused to herself, "It has taken over 30 years, but I've finally been named CEO of a major firm. Now, I can concentrate on
Natasha2012 [34]

Answer:

Strategic.

Explanation:

In Business management, a strategy can be defined as a set of guiding principles, actions and decisions that an organization combines so as to achieve its business goals, attract customers and possess a competitive advantage over its rivals in the industry.

Business strategy sets the overall direction for the business because it focuses on defining how a business would achieve its goals, objectives, and mission; as well as the funds and material resources required to implement or execute the business plan.

A manager can be defined as an individual who is saddled with the responsibility of providing guidance, support, supervision, administrative control, as well as acting as a role model or an example to the employees working in an organization by being morally upright.

A strategic manager is also referred to as a top-level manager and he or she is mainly focused on setting goals, objectives, and procedures in order to enhance the survival, growth, and overall effectiveness of a business firm.

Hence, Sylvia can concentrate on what she really want to do as a strategic manager, by focusing on the survival, growth, and overall effectiveness of our firm.

5 0
3 years ago
Although the average annual price for a four-year public college is roughly $8,600, how much does the average student pay after
djverab [1.8K]

In general, after a student applies gift aid to public college fees, they get to pay<u> less than $3,000.</u>

Gift aid refers to financial support towards one's education that they do not have to pay back. The various forms include:

  • Scholarships
  • Grants

When students get both of these, it can reduce the amount they have to pay for college by more than 50% such that they only end up paying less than $3,000 in public universities.

In conclusion, gift aid helps public college students pay less than $3,000 in college fees.

<em>Find out more at brainly.com/question/20087400. </em>

4 0
2 years ago
Net income $160,000 Preferred dividends $10,000 Shares of common stock outstanding 20,000 Market price per share of common stock
Luden [163]

Answer:

The company's earnings per share on common stock is  $7.50

Explanation:

Given data

Net income N = $160,000

Preferred dividends D =  $10,000

common  stock outstanding C = 20,000

Market price P = $35 / share

to find out

earnings per share on common stock is

solution

we will find earning per share that is given by  

Earnings per share = (net income - preferred dividend ) / common  stock outstanding

so now put all these value in this equation we get

Earnings per share =  ( 160,000 - 10,000 ) / 20,000

Earnings per share =  ( 150,000 ) / 20,000

Earnings per share =  7.5

so The company's earnings per share on common stock is  $7.50

4 0
4 years ago
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