There are many kinds of real options,which are valuable,in each phase of the lifetime of an information technology(IT)project.However,in the current IT investment decision theory,real options that embedded in IT proje...There are many kinds of real options,which are valuable,in each phase of the lifetime of an information technology(IT)project.However,in the current IT investment decision theory,real options that embedded in IT projects are not considered. In this paper, the process of IT project decision and implementation is fully analyzed, the real options that may be embedded in an IT project are identified, and a real option analysis (ROA) method is proposed for evaluation of an IT project under uncertain business environment. ROA employs Black-Scholes expansion model and cancels the assumption that the cost of project is certain. The numerical example manifests that the ROA can better evaluate IT project and select the IT investment alternative. Finally, a road map is provided to help selecting the suitable evaluation method to make IT investment decision.展开更多
Behavioral finance is a field that is scrutinizing the adequacy of traditional financial theories using insights from the disciplines of psychology and sociology. Many studies within its realm test the stock market be...Behavioral finance is a field that is scrutinizing the adequacy of traditional financial theories using insights from the disciplines of psychology and sociology. Many studies within its realm test the stock market behaviors, and behavioral phenomena are still to be tested in the area of corporate finance. This study aims to contribute to the behavioral corporate finance literature by a research in one of the psychological phenomena affecting the decision makers＇ abilities to reach conclusions rationally. In this study, it is aimed to investigate one of the biases, namely, the optimism bias in corporate capital budgeting decisions. Optimism in decision making can be associated with estimating lower costs and higher revenues. Thus, by assessing the forecasts of decision makers, the existence of optimism in their decisions is tried to be seen. This study aims at contributing to the literature in that it is conducted in an emerging country like Turkey.展开更多
Corporate restructuring was identified as a new industrial force that has great impact on economic values and that therefore has become central in daily financial decision making. This article investigates the optimal...Corporate restructuring was identified as a new industrial force that has great impact on economic values and that therefore has become central in daily financial decision making. This article investigates the optimal restructuring strategies under different dynamic factors and their numerous impacts on firm value. The concept of quasi-leverage is introduced and valuation models are built for corporate debt and equity under imperfect market conditions. The model’s input variables include the quasi-leverage and other firm-specific parameters, the output variables include multiple corporate security values. The restruc- turing cost is formulated in the form of exponential function, which allows us to observe the sensitivity of the variation in security values. The unified model and its analytical solution developed in this research allow us to examine the continuous changes of security values by dynamically changing the coupon rates, riskless interest rate, bankruptcy cost, quasi-leverage, personal tax rate, corporate taxes rate, transaction cost, firm risk, etc., so that the solutions provide useful guidance for financing and restructuring decisions.展开更多
文摘There are many kinds of real options,which are valuable,in each phase of the lifetime of an information technology(IT)project.However,in the current IT investment decision theory,real options that embedded in IT projects are not considered. In this paper, the process of IT project decision and implementation is fully analyzed, the real options that may be embedded in an IT project are identified, and a real option analysis (ROA) method is proposed for evaluation of an IT project under uncertain business environment. ROA employs Black-Scholes expansion model and cancels the assumption that the cost of project is certain. The numerical example manifests that the ROA can better evaluate IT project and select the IT investment alternative. Finally, a road map is provided to help selecting the suitable evaluation method to make IT investment decision.
文摘Behavioral finance is a field that is scrutinizing the adequacy of traditional financial theories using insights from the disciplines of psychology and sociology. Many studies within its realm test the stock market behaviors, and behavioral phenomena are still to be tested in the area of corporate finance. This study aims to contribute to the behavioral corporate finance literature by a research in one of the psychological phenomena affecting the decision makers＇ abilities to reach conclusions rationally. In this study, it is aimed to investigate one of the biases, namely, the optimism bias in corporate capital budgeting decisions. Optimism in decision making can be associated with estimating lower costs and higher revenues. Thus, by assessing the forecasts of decision makers, the existence of optimism in their decisions is tried to be seen. This study aims at contributing to the literature in that it is conducted in an emerging country like Turkey.
文摘Corporate restructuring was identified as a new industrial force that has great impact on economic values and that therefore has become central in daily financial decision making. This article investigates the optimal restructuring strategies under different dynamic factors and their numerous impacts on firm value. The concept of quasi-leverage is introduced and valuation models are built for corporate debt and equity under imperfect market conditions. The model’s input variables include the quasi-leverage and other firm-specific parameters, the output variables include multiple corporate security values. The restruc- turing cost is formulated in the form of exponential function, which allows us to observe the sensitivity of the variation in security values. The unified model and its analytical solution developed in this research allow us to examine the continuous changes of security values by dynamically changing the coupon rates, riskless interest rate, bankruptcy cost, quasi-leverage, personal tax rate, corporate taxes rate, transaction cost, firm risk, etc., so that the solutions provide useful guidance for financing and restructuring decisions.
