DOIONLINE 
DOIONLINE Publish In |
International Journal of Management and Applied Science (IJMAS)-IJMAS |
 Journal Home Volume Issue |
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Issue |
Volume-3,Issue-12 ( Dec, 2017 ) | |||||||||
Paper Title |
The Derivation of Diffusion-Jump Modes for Power Plant Projects Under Risk | |||||||||
Author Name |
Chou-Yen Lai, Borliang Chen, Hue-Chiuenshiong | |||||||||
Affilition |
National United University | |||||||||
Pages |
4-7 | |||||||||
Abstract |
High market risks are embedded in mega-scale projects.These risks includepoliticalinstability, economic instability, social risks, technical risks, and other non-financial factors. All these risk factors will have directly impacted on financial feasibility of projects. Hence, it isnecessary to performan elaborate financial analysis of projects at planning stage. A jump diffusion option-pricing model is derived for considering the managerial flexibility of scale expansion in the financial analysis of projects to increase the project value. Keywords- Jump Diffusionoption Pricing Model, The Real Option, Call Option. | |||||||||
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