Gleason research regularly takes real options into account when evaluating its proposed projects. specifically, it considers the option to abandon a project whenever it turns out to be unsuccessful (the abandonment option), and it evaluates whether it is better to invest in a project today or to wait and collect more information (the investment timing option). assume the proposed projects can be abandoned at any time without penalty.
which of the following statements is correct?
(a) the abandonment option tends to reduce a project's npv.
(b) the abandonment option tends to reduce a project's risk.
(c) if there are important first-mover advantages, this tends to increase the value of waiting a year to collect more information before proceeding with a proposed project.
(d) a project can either have an abandonment option or an investment timing option, but never both.
(e) investment timing options always increase the value of a project.

Aprice ceiling is “binding” if the price ceiling is set below the equilibrium price. suppose that the equilibrium price is $5. if a price ceiling is set at $6, this will not affect the market in any way since $5 remains a legally allowable price (since $5 < $6). a price ceiling of $6 is called a “non-binding” price ceiling. on the other hand, if the price ceiling is set at $4, the price ceiling is “binding” because the natural equilibrium price is $5 but that is no longer allowed. what happens when there is a binding price ceiling? at a price below the equilibrium price, quantity demanded exceeds quantity supplied. there is a shortage. normally, price increases eliminate shortages by increasing quantity supplied and decreasing quantity demanded. in this case, however, price increases are not allowed past the price ceiling. we therefore predict that the observed market price will be right at the price ceiling and there will be a permanent shortage. the observed quantity bought and sold will be dictated by the quantity supplied at the price ceiling. although consumers would like to buy more, there are no more units for sale

Witch is an example of a non durable good?

When the national economy goes from bad to better, market research shows changes in the sales at various types of restaurants. projected 2011 sales at quick-service restaurants are $164.8 billion, which was 3% better than in 2010. projected 2011 sales at full-service restaurants are $184.2 billion, which was 1.2% better than in 2010. how will the dollar growth in quick-service restaurants sales compared to the dollar growth for full-service places?