publication . Other literature type . Article . 2017

Evaluation of Subjective Utility Function Parameters

Danko, E.V.; Altai State University;
  • Published: 22 May 2017
  • Publisher: Altai State University
Abstract
The paper presents a method of quantitative evaluation of subjective utility function parameters for investment decision-making process. The proposed method allows quantitative evaluation of two factors: the individual risk aversion and individual disposition toward lost business opportunities. Both factors are the main psychological aspects that can be observed during a decisionmaking process under uncertainty and risk. The effectiveness of an investment project is evaluated by NPV index. This index is considered a random variable that can be estimated by an investor as an interval [NPV1; NPV2 ]. Main difficulties in decision-making process arise when [NPV1; NP...
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publication . Other literature type . Article . 2017

Evaluation of Subjective Utility Function Parameters

Danko, E.V.; Altai State University;