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Risk Analysis in Project Evaluation

Risk Analysis in Project Evaluation

Copyright: © 2019 |Pages: 57
ISBN13: 9781522576969|ISBN10: 1522576967|ISBN13 Softcover: 9781522586722|EISBN13: 9781522576976
DOI: 10.4018/978-1-5225-7696-9.ch007
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MLA

Halil Sarıaslan. "Risk Analysis in Project Evaluation." Planning and Analyzing Foreign Direct Investment Projects: Emerging Research and Opportunities, IGI Global, 2019, pp.240-296. https://doi.org/10.4018/978-1-5225-7696-9.ch007

APA

H. Sarıaslan (2019). Risk Analysis in Project Evaluation. IGI Global. https://doi.org/10.4018/978-1-5225-7696-9.ch007

Chicago

Halil Sarıaslan. "Risk Analysis in Project Evaluation." In Planning and Analyzing Foreign Direct Investment Projects: Emerging Research and Opportunities. Hershey, PA: IGI Global, 2019. https://doi.org/10.4018/978-1-5225-7696-9.ch007

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Abstract

This final chapter is devoted to the analysis of the risks associated with foreign direct investments, namely business (commercial) risk, political risk, and currency exchange rate risk. Each risk factor is considered as a separate evaluation criterion. That is, an investment project may be rejected due to having a high level of any one of these three risk factors. For instance, a profitable investment proposal may not have a significant business risk but might have a high level of political risk requiring its rejection. Risk analysis is conducted only if a foreign investment project is profitable from the viewpoint of the parent company. Otherwise, there is no need for a risk analysis since a direct investment project that does not create profit for the parent company would be rejected anyway.

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