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Real Options and Investment under Uncertainty Classical Readings and Recent Contributions
ISBN: 0262194465     Date Published: 2001-01-02     Author(s): Wayne D. Purcell, Stephen R. Koontz
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Hardcover
The MIT Press
881 Pages
 
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06/20/2013 01:25:11
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Editorial Review - Book Description:

The study of investment under uncertainty was stagnant for several decades, until recent developments in real options provided the tools to revitalize the field. The techniques and insights derived from option pricing can now be used to quantify the elusive elements of managerial operating flexibility and strategic interactions ignored or underestimated by conventional Net Present Value and other quantitative approaches.

Topics covered include the reasons for the under-investment problem and conceptual frameworks for viewing productive investment opportunities as real options; useful valuation building blocks; the quantifying of various types of real options separately and in combination; strategic aspects of investment under uncertainty; numerical analysis techniques; a variety of applications, including the valuing of natural resources, R&D and pioneer ventures, land development, strategic acquisitions, government subsidies, power plants and pollution options, flexible manufacturing, and multinational operations; and empirical evidence from oil leasing, land prices, and discontinued operations.

About the Author
Eduardo S. Schwartz is the California Professor of Real Estate and Professor of Finance, Anderson Graduate School of Management, the University of California, Los Angeles. Lenos Trigeorgis is Professor of Finance, School of Economics and Management, the University of Cyprus, and President of the Real Options Group.
 
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Good Collection of Articles, April 22, 2008 ByC. Ang "cliff_ang" (Chicago, IL) - See all my reviews Amazon Verified Purchase(What's this?) This review is from: Real Options and Investment under Uncertainty: Classical Readings and Recent Contributions (Paperback) This textbook provides the student with a good collection of papers on fundamental aspects of real options. Traditional NPV analysis gets a trashing by this book and the proponents of real options analysis. Of course, there is some merit to it or else many prominent academics would not waste their time discussing the issues. There is a good blend of theoretical and empirical papers, and the papers discuss a variety of applications from the traditional natural resource investment to real estate.
 
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