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Capital Budgeting and the Utilization of Full Information: Performance Evaluation and the Exercise of Real Options

Tamir Agmon (Professor of Research, Finance and Business Economics, Graduate School of Business Administration, USC, and the Faculty of Management, Tel Aviv University)

Managerial Finance

ISSN: 0307-4358

Article publication date: 1 February 1991

Abstract

Recently there has been a new interest in capital budgeting. The interest can be traced to two sources: (1) lack of satisfaction with the way that standard NPV procedures perform, and (2) the development of new financial techniques and their application to corporate finance, notably the application of option pricing models. The first source creates the demand for a critical re‐evaluation of the accepted procedures of capital budgeting, the second provides the means for such an evaluation.

Citation

Agmon, T. (1991), "Capital Budgeting and the Utilization of Full Information: Performance Evaluation and the Exercise of Real Options", Managerial Finance, Vol. 17 No. 2/3, pp. 42-50. https://doi.org/10.1108/eb013669

Publisher

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MCB UP Ltd

Copyright © 1991, MCB UP Limited