Investment Under Uncertainty

The Effect Of Salvage Market On Strategic Technology Choice And Capacity Investment Decision Of Firm Under Demand Uncertainty

Foreign Investment as Main Factor for Successful Funds and Its Effect on Trade Balance Strategic Technology Adoption under Technological Uncertainty

Economic Appraisal of Investment Projects in Solar Energy under Uncertainty via Fuzzy Real Option Approach (Case Study: a 2-MW Photovoltaic Plant in South of Isfahan, Iran)

Investment in renewable energies especially solar energies is encountered with numerous uncertainties considering the increased dynamism in economic and financial conditions and makes investment in this field irreversible to a large extent, paying attention to modern methods of economic appraisal of such investments is highly important. A framework is provided in the current study in order to e...

Dynamic Relationship between Inflation Uncertainty and Private Investment in Iran: An Application of VAR-GARCH-M Model

This paper empirically investigates the relationship between CPI inflation uncertainty, and private investment in the Iranian economy from 1988 to 2010 by using quarterly data. We employ a bivariate VAR(5)-GARCH(1,1)-in-mean with diagonal BEKK model to discover in a unified framework how are the interactions between the variables. In the model, conditional variance of inflation and private inve...

Production Flexibility and Investment under Uncertainty

This paper extends the theory of real options, which mainly considers the problem of timing of investment, by letting the firm choose also the quantity produced after the time of investment. Under the conditions of irreversible investment and uncertainty in future demand, the firm can adjust its output quantity at each point in time in the future. Our paper shows that changing the structure of ...

Incorporating Risk Preferences into Real Options Models

This paper develops a framework to link the expected utility analysis to real options models in order to capture the joint effects of risk aversion and irreversibility associated with real investments. It aims at modifying the theory of investment under uncertainty by incorporating decision makers’ risk preferences and allows explicitly analyzing the impacts of risk aversion, uncertainty and ir...