Analysis of capital expenditure projects with uncertain discrete cash flows

Jose Ma Tanchoco, James R Buck and Pius J Egbelu

Omega, 1982, vol. 10, issue 3, 299-307

Abstract: In this paper, a methodology is presented for evaluating risky projects whose cash flows, start times and durations are not known with certainty. The methodology directly computes statistics of the present worth (i.e. means and variances) from closed-form analytical formulas which are derived with explicit consideration of the risks associated with the individual variables that affect the profitability index of the projects. It is assumed that the cash flows occur discretely over time and that a fixed discount rate exists over the project duration. The application of the technique is demonstrated through systematic steps on a number of example problems.

Date: 1982
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/0305-0483(82)90100-1
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jomega:v:10:y:1982:i:3:p:299-307

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/supportfaq.cws_home/regional
https://shop.elsevie ... _01_ooc_1&version=01

Access Statistics for this article

Omega is currently edited by B. Lev

More articles in Omega from Elsevier
Bibliographic data for series maintained by Catherine Liu ().