2009•Journal of Lanzhou Jiaotong UniversityRequires access
Research on the Project Economic Evaluation Based on Real Options
Yanlong Zhao
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Abstract
Principles and characteriatics of the project economic evaluation are presented based on real options.Black-Scholes' pricing model is employed to analyze an evaluation case.Compared with the traditional method of decision-making based on the net present value,randomicity factors are taken into account sufficiently in real options.Consequently,the investment decision-making will be more rational.