1. How might Wal-Mart (or another large company) take advantage of each of the following: Do not merely provide a definition. Provide a specific example of each Show all answers in Excel.
a. Flexibility option
b. Growth option
c. Investment timing option
d. Abandonment option
e. Decision-tree analysis
2. You have a chance to buy an annuity that pays $1,200 at the end of each month for 36 months. You could earn an annual nominal rate of 6.0% on your money in other investments with equal risk. What is the most you should pay for the annuity? Please show how its performed in excel.
None of the above
$30,754
$26,369
$39,445
$27,757