Two phase parametric and probabilistic NPV calculations, with possible deferral of disposal of UK nuclear waste as an example

doi:10.1016/S0305-0483(97)00026-1

Omega

Volume 25, Issue 6, December 1997, Pages 707-714

https://doi.org/10.1016/S0305-0483(97)00026-1 Get rights and content

Abstract

This paper illustrates the value of several particular features of a first phase parametric approach to discounted cash flow (DCF) decision analysis when significant uncertainty is involved. It also illustrates the value of second phase probabilistic approaches to selected parameters for five quite different example reasons. The most controversial example reason concerns the discount rate. The particular example used to illustrate both phases may stimulate general interest because of the important issues involved, but it is argued that the two phase approach as a whole has a wide range of applications for decisions large and small.

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Two phase parametric and probabilistic NPV calculations, with possible deferral of disposal of UK nuclear waste as an example

Abstract

Omega, The International Journal of Management Science

Capital Investment Appraisal

The Finance and Analysis of Capital Projects

Review of Radioactive Waste Management Policy Preliminary Conclusions: A Consultative Document

A lattice claims model for capital budgeting

Management Science

A log-transformed binomial numerical analysis method for valuing complex multi-option investment

Journal of Financial and Quantitative Analysis