A Sensitivity Analysis of a Certain Mathematical Model of Expert Evaluation of Investment Projects

УДК 519.87

  • E.V. Danko Altai State University (Barnaul, Russia) Email: evdanko88@gmail.com
DOI_disc_logo https://doi.org/10.14258/izvasu(2021)4-14
Keywords: subjective utility function, decision making effectiveness evaluation, evaluation of investment results, analysis of investment project scenarios, analysis of investment effectiveness

Abstract

The paper presents a sensitivity analysis of the developed mathematical model of expert evaluation of investment projects. Processes of investment projects implementations are analyzed as decision-making processes under uncertainty. The mathematical model under study evaluates the effectiveness of an investment project using the NPV index. This index is considered a random variable and can be estimated by an investor as a segment [NPV1; NPV2J. The proposed mathematical model utilizes the probability density function of NPV in the form of Pearson curves of the first type. Another peculiar feature of the mathematical model is utilization of the subjective utility function in decision making of whether to invest or not to invest in some project. The subjective utility function considers individual characteristics of investors and their decision making under risks and uncertainty. Perception of additional information by investors changes depending on their attitude toward risk and missed opportunities and thus reduces uncertainty in decision making. The paper studies this step in detail and provides some conclusions proving the correctness of the developed mathematical model.

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Author Biography

E.V. Danko, Altai State University (Barnaul, Russia)

доцент кафедры цифровых технологий и бизнес-аналитики

References

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Published
2021-09-10
How to Cite
Danko E. A Sensitivity Analysis of a Certain Mathematical Model of Expert Evaluation of Investment Projects // Izvestiya of Altai State University, 2021, № 4(120). P. 91-96 DOI: 10.14258/izvasu(2021)4-14. URL: http://izvestiya.asu.ru/article/view/%282021%294-14.
Issue
No 4(120) (2021): Известия Алтайского государственного университета
Section
Математика и механика

Copyright (c) 2021 Евгений Викторович Данько

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