Date of Completion
Spring 5-6-2012
Thesis Advisor(s)
James Sfiridis
Disciplines
Finance and Financial Management
Abstract
A capital budgeting case study involving determination of relevant cash flows over a projects life then the calculation of a number of decision criteria to determine if project should be accepted. Then risk will be incorporated using two methods of risk adjustment: scenario and sensitivity analysis. The findings will guide the state of the art Monte Carlo simulation using continuous and discrete probability distributions to model the risk of cash flow inputs. Using @Risk software as an Excel add in simulations will be run to determine a large number of decision variables. A comparison of cost of capital from each method will be made to analyze projects variation.
Recommended Citation
Gallagher, Caitlin, "Monte Carlo Simulation and Risk Assessment in Capital Bugeting" (2012). Honors Scholar Theses. 259.
https://digitalcommons.lib.uconn.edu/srhonors_theses/259