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Commodore Corporation is deciding whether to invest in a project today or to postpone the decision until next year.

Commodore Corporation is deciding whether to invest in a project today or to postpone the decision until next year. The project has a positive expected NPV, but its cash flows could be less than expected, in which case the NPV could be negative. No competitors are likely to invest in a similar project if Commodore decides to wait. Which of the following statements best describes the issues that Commodore faces when considering this investment timing option?

This question was asked on Mar 31, 2010.

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