A review of: “ENGINEERING ECONOMY WITH COMPUTER APPLICATIONS”, by Dr. Arup K. Mnllik,Engineering Technology,Inc., Mahomet,Illinois, 1979, 289 pages,list 517.95.

This paper applies option pricing analysis to the problem of valuing the abandonment option of an investment proposal. The assumption is made that the abandonment option is exercisable at only one point in time in the future and that the project's vatue-in-use and its abandonment value are lognormally distributed. The model is employed to measure how the uniqueness of the project asset, as measured by the correlation between these two lognormal random variables, affects the value of the abandonment option. It is shown that the more unique the asset, or the higher the correlation, the lower is the value of the abandonment option. The model is also employed to examine the impact of increased uncertainty in these two random variables on the value of the abandonment option. The relationships are shown to be nonmonotonic. However, beyond critical thresholds, increased uncertainty in either one of the two variables enhances the value of the abandonment option.     

轩尼诗X.O.2007亚洲爵士乐巡演 经历愈多,看得愈真,愈懂得欣赏

(2007年5月19日,上海)轩尼诗X.O始终致力于将现代雅致的生活精粹带到世界的各个角落。     

Review of:“ MAINTAINABILITY AND MAINTENANCE MANAGEMNT” by Joseph D. Patton,Jr., Instrument Society of America,Research Triangle Park,N.C., 1980, xiii + 441 pages,list $35.00.

To affect the actual project selection process of a corporate research lab, the project selection process needs to be simple and transparent enough to ensure effective communication among project leaders, research implementers and technology strategists. In this way, the project selection process stimulates project creation. If net present value (NPV) is our project criterion, this requires simplified NPV formulas. In this paper, we develop such formulas in the context of a major application.