Volume 10, Issue 3, March 2015, Pages 881–890
Accounting, Economics and Financial Management Conference (AEFMC 2014), Iran 26-27 October 2014
Moslem Amini1, Fatemeh Alijani2, and Zana Mozaffari3
1 Islamic Azad University of Qazvin, Qazvin, Qazvin, Iran
2 Department of Agricultural Economics, Payame Noor University, Tehran, Tehran, Iran
3 University of Tabriz, Tabriz, Tabriz, Iran
Original language: English
Copyright © 2015 ISSR Journals. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Evidence suggests that mining projects include risk and this kind of business is complex and includes unpredictable costs and also in many cases, such as exploration evaluation, uncertainty of the mining engineering and economic uncertainty are affective. In this paper we use two scenarios for economic evaluation of project. First scenario investigates certainty of prices and operating costs and second scenario uncertainty of prices and costs. It is concluded that the mine evaluation suggests greater net present value when uncertainty is considered for both price and operating costs. The purpose of this study is investigated decision making in certain and uncertain situations. For investigate this subject binominal tree by DiverGen software and for calculating of present value of the project Excel software were used .results show that binominal tree is better device for decision making in uncertain situations.
Author Keywords: Economic uncertainty, Metal price, Operating costs, Net present value, Binomial tree technique, Sensitivity analysis.
Accounting, Economics and Financial Management Conference (AEFMC 2014), Iran 26-27 October 2014
Moslem Amini1, Fatemeh Alijani2, and Zana Mozaffari3
1 Islamic Azad University of Qazvin, Qazvin, Qazvin, Iran
2 Department of Agricultural Economics, Payame Noor University, Tehran, Tehran, Iran
3 University of Tabriz, Tabriz, Tabriz, Iran
Original language: English
Copyright © 2015 ISSR Journals. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Abstract
Evidence suggests that mining projects include risk and this kind of business is complex and includes unpredictable costs and also in many cases, such as exploration evaluation, uncertainty of the mining engineering and economic uncertainty are affective. In this paper we use two scenarios for economic evaluation of project. First scenario investigates certainty of prices and operating costs and second scenario uncertainty of prices and costs. It is concluded that the mine evaluation suggests greater net present value when uncertainty is considered for both price and operating costs. The purpose of this study is investigated decision making in certain and uncertain situations. For investigate this subject binominal tree by DiverGen software and for calculating of present value of the project Excel software were used .results show that binominal tree is better device for decision making in uncertain situations.
Author Keywords: Economic uncertainty, Metal price, Operating costs, Net present value, Binomial tree technique, Sensitivity analysis.
How to Cite this Article
Moslem Amini, Fatemeh Alijani, and Zana Mozaffari, “Economic evaluation of mining projects under conditions of uncertainty for prices and operating costs,” International Journal of Innovation and Applied Studies, vol. 10, no. 3, pp. 881–890, March 2015.
