search query: @author Pindyck, R.S. / total: 3
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| Author: | Majd, S. Pindyck, R.S. |
| Title: | Time to build, option value, and investment decisions |
| Journal: | Journal of Financial Economics
1987 : MAR, VOL. 18:1, p.7-27 |
| Index terms: | INVESTMENT DECISION MAKING |
| Language: | eng |
| Abstract: | Investment decisions and outlays are often made sequentially. The arrival of new information might lead the firm to depart from the spending scenario originally planned: the firm might accelerate or decelerate the rate of investment or simply stop the program in midstream. A contingent claims analysis is used to derive optimal decision rules and to value such investments. The effects of time to build, opportunity cost and uncertainty on the investment decision are determined. |
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