SUBSTANTIATION OF THE INNOVATION AND INVESTMENT PROJECT USING THE METHOD OF REAL OPTIONS
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© IAEME Publication
Abstract
The main aspects of using the method of real options in substantiating the
innovation and investment project are considered in the article. It was found that for
the development and implementation of innovation and investment projects it is
advisable to use the method of real options (ROV), which allows informed
management decisions even in conditions of high uncertainty, as it can significantly
increase the potential economic efficiency of investment projects. Two main methods
are used to estimate the value of real options: the Black-Scholes option valuation
model and the binomial model. The article describes the algorithm for implementing
the methodology for evaluating an innovation and investment project with venture
financing based on the method of real options.
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Citation
Basiurkina, N., Sysoieva, I., Ratushna, J., Kotenko, T., Baistriuchenko, N., & Sukhanova, A. (2020). Substantiation of the innovation and investment project using the method of real options. International Journal of Management, Vol. 11, 5, 497—510. https://doi.org/10.34218/IJM.11.5.2020.047. Nataliya Basiurkina, Inna Sysoieva, Julia Ratushna, Tetiana Kotenko, Nataliia Baistriuchenko and Alla Sukhanova, Substantiation of the Innovation and Investment Project Using the Method of Real Options. International Journal of Management, 11 (5), 2020, pp. 497-510. http://www.iaeme.com/IJM/issues.asp?JType=IJM&VType=11&IType=5