Including the option to expand in your project analysis will tend to:
A) Extend the duration of a project but not affect the project's net present value.
B) Increase the cash ﬂows of a project but decrease the project's net present value.
C) Increase the net present value of a project.
D) Decrease the net present value of a project.
E) Have no effect on either a project's cash ﬂows or its net present value.

Question

Quizplus · Accepted Answer

Including the option to expand will increase the flexibility of the project and allow for potential future growth, which can increase the net present value of the project.

Including the Option to Expand in Your Project Analysis Will