search query: @author Herath, H. / total: 3
reference: 2 / 3
| Author: | Herath, H. Park, C. |
| Title: | Economic analysis of R&D projects: an options approach |
| Journal: | Engineering Economist
1999 : VOL. 44:1, p. 1-35 |
| Index terms: | ECONOMICS R&D PROJECTS |
| Language: | eng |
| Abstract: | An emerging trend in research and development (R&D) project valuation is the use of options approach, which permits a more flexible assessment of the future growth opportunities in the entire process. The traditional DCF method when naively applied fails to capture all the future opportunities that create value, thereby resulting in an under investment in R&D. The options approach is more appropriate in a world of uncertainty because it views an R&D project as an initial investment that creates future follow-on commercial opportunities that are undertaken only if the initial R&D project is successful. |
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