Risk Analysis in Investment Appraisal

Savvakis Savvides

Finance from University Library of Munich, Germany

Abstract: This paper was prepared for the purpose of presenting the methodology and uses of the Monte Carlo simulation technique as applied in the evaluation of investment projects to analyse and assess risk. The first part of the paper highlights the importance of risk analysis in investment appraisal. The second part presents the various stages in the application of the risk analysis process. The third part examines the interpretation of the results generated by a risk analysis application including investment decision criteria and various measures of risk based on the expected value concept. The final part draws some conclusions regarding the usefulness and limitations of risk analysis in investment appraisal.

Keywords: Risk Analysis; Monte Carlo simulation; Investment appraisal; Project analysis; Forecasting and simulation; Business administration (search for similar items in EconPapers)
JEL-codes: D81 F47 G31 M10 O22 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2004-09-07
New Economics Papers: this item is included in nep-cfn, nep-cmp, nep-fin and nep-rmg
Note: Type of Document - pdf; pages: 33
References: View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Downloads: (external link)
https://econwpa.ub.uni-muenchen.de/econ-wp/fin/papers/0409/0409020.pdf (application/pdf)

Related works:
Working Paper: Risk Analysis in Investment Appraisal (2008)
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:wpa:wuwpfi:0409020

Access Statistics for this paper

More papers in Finance from University Library of Munich, Germany
Bibliographic data for series maintained by EconWPA ( this e-mail address is bad, please contact ).