A new fuzzy real options valuation model: Its application to multicriteria R&D project selection


TOLGA A. Ç. , Kahraman C.

8th International Conference on Fuzzy Logic and Intelligent Technologies in Nuclear Science, Madrid, Spain, 21 - 24 September 2008, vol.1, pp.641-646 identifier identifier

  • Publication Type: Conference Paper / Full Text
  • Volume: 1
  • Doi Number: 10.1142/9789812799470_0105
  • City: Madrid
  • Country: Spain
  • Page Numbers: pp.641-646

Abstract

Real options valuation is a financial technique for evaluating investments under conditions of uncertainty, particularly uncertainty associated with market variables such as future product demand or the future value of an asset. The real option value of the investment opportunity is what a value-maximizing firm would pay for the right to undertake the investment project with its inherent decision points. This paper proposes a fuzzy multicriteria R&D project selection methodology based on the hierarchical TOPSIS, which includes a fuzzy real options valuation model.