1. ABC, Inc. has a potential capital budgeting project with a growth option. The NPV of the project with the growth option is $1,631 and without the growth option is $472. What is the value of this option to ABC?
A. $1,631
B. $1,159
C. $2,103
D. None of the above
2. The ____ the MNC's cost of capital, the ____ will be a project's net present value for its proposed project with a given set of expected cash flows.
lower; higher
higher; higher
lower; lower
none of the above