Risk Analysis in Investment Appraisal

Savvakis Savvides

MPRA Paper from University Library of Munich, Germany

Abstract: The methodology and uses of Monte-Carlo simulation technique are presented as applied to the analysis and assessment of risk in the evaluation of investment projects. The importance of risk analysis in investment appraisal is highlighted and the stages in the process introduced. The results generated by a risk analysis application are interpreted, including the investment decision criteria and measures of risk based on the expected value concept. Conclusions are drawn regarding the usefulness and limitations of risk analysis in investment appraisal.

Keywords: risk analysis; investment appraisal; Monte Carlo simulation; project evaluation; measures of risk; investment decision criteria (search for similar items in EconPapers)
JEL-codes: G31 G32 M21 (search for similar items in EconPapers)
Date: 1994-03, Revised 2008-08-14
New Economics Papers: this item is included in nep-ppm, nep-rmg and nep-upt
References: View complete reference list from CitEc
Citations: View citations in EconPapers (13)

Published in Project Appraisal 1.Volume(1994): pp. 3-18

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Related works:
Working Paper: Risk Analysis in Investment Appraisal (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:10035

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