Konverterat

Authors:

  • Maria Hedvall

Publish date: 2007-11-21

Report number: FOI-R--2340--SE

Pages: 37

Written in: Swedish

Keywords:

  • capital budgeting
  • flexilbility
  • research and development

Abstract

Organisations can make different sorts of investments to be able to adapt to changing conditions. They can invest in research and development (R & D), in flexible equipment and they can defer investments as a means to accommodate. This report focuses on investments in research and development as a means to reduce risk.More particularly, the report aims to calculate the opportunity cost of investing in R&D by using the technique of "net present value". The main contributions arae to define the option of investing in R&Das swell as the payments caused by the different options.