Evaluation Method for Wind Power Project Investment Based on Real Options Theory
Yang Qiang-hua
Abstract
Yang Qiang-hua
Abstract
Due to the exacerbating complex economic and political level of the today's society,traditional investment decision-making methods,without taking into account the uncertainty and investment flexibility in decision-making,underestimate the value of the investment project.The real options method compensates for the defects of the traditional investment decision-making methods.It can assess the value of the project in high uncertainty environment accurately.In this paper,Error Back-propagation Training simulates the main parameters of the option value-the volatility of the value of the project,which improve the objectivity of the real options approach in evaluating the value of the project.In this aitifical,we use an example to verify the mathod.
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Due to the exacerbating complex economic and political level of the today's society,traditional investment decision-making methods,without taking into account the uncertainty and investment flexibility in decision-making,underestimate the value of the investment project.The real options method compensates for the defects of the traditional investment decision-making methods.It can assess the value of the project in high uncertainty environment accurately.In this paper,Error Back-propagation Training simulates the main parameters of the option value-the volatility of the value of the project,which improve the objectivity of the real options approach in evaluating the value of the project.In this aitifical,we use an example to verify the mathod.
Key concepts: Volatility (finance), Option value, Investment (military), Flexibility (engineering), Value (mathematics), Objectivity (philosophy), Computer science, Investment decisions