Which of the Following Will NOT Increase the Value of a Real

Multiple Choice

Which of the following will NOT increase the value of a real option?

A) an increase in the volatility of the underlying source of risk.
B) an increase in the risk-free rate.
C) an increase in the cost of obtaining the real option.
D) a decrease in the probability that a competitor will enter the market of the project in question.
E) lengthening the time in which a real option must be exercised.