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Real options: Capital investment appraisal; estimating the market price of risk and application to the valuation of a new business

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  • Muhammad Mustafa RASHID

Abstract

This paper applies real options theory to capital investment appraisal. It estimates the market price of risk and demonstrates how to value a new business venture under uncertainty using financial modeling techniques.

Suggested Citation

  • Muhammad Mustafa RASHID, 2022. "Real options: Capital investment appraisal; estimating the market price of risk and application to the valuation of a new business," Journal of Economics Bibliography, EconSciences Journals, vol. 9(2), pages 94-98, June.
    • Handle: RePEc:cvv:journ6:v:9:y:2022:i:2:p:94-98
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    References listed on IDEAS

    as
    1. Muhammad Mustafa RASHID, 2020. "International financial credit crises; Lessons from Canada," Journal of Economics Bibliography, EconSciences Journals, vol. 7(2), pages 100-110, June.
    2. Eduardo S. Schwartz & Mark Moon, 2000. "Rational Pricing of Internet Companies," Financial Analysts Journal, Taylor & Francis Journals, vol. 56(3), pages 62-75, May.
    3. William F. Sharpe, 1964. "Capital Asset Prices: A Theory Of Market Equilibrium Under Conditions Of Risk," Journal of Finance, American Finance Association, vol. 19(3), pages 425-442, September.
    Full references (including those not matched with items on IDEAS)

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    Keywords

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    JEL classification:

    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis

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