Algorithm of Implementation of the Optimization Model of Decision Making in Modern Business Systems

Abstract

Purpose

The purpose of the chapter is to model the process of decision-making on selection of a certain process depending on the investing strategy.

Structure/Methodology/Approaches

The work includes consideration of the project on the basis of a simplified simulation model. Modeling is performed by the Monte Carlo method. Criteria of evaluation of the investment project are net investment value and profitability index.

Results

The authors model the process of decision-making by the example of analysis of an investment project. The process is implemented on the basis of the simulation model in the Mathcad program. Three cases of investing are considered: constant, change by linear law, and changed by non-linear law. Criteria of evaluation of investment project are selected, and risks are determined. The corresponding conclusions are made.

Originality/Value

The performed research is of the applied value and could be used for modeling real business processes at a company.

Citation

Asanova, N.V., Kozhanova, T.E., Andreeva, Y.Y. and Nekrasova, V.V. (2019), "Algorithm of Implementation of the Optimization Model of Decision Making in Modern Business Systems", Popkova, E.G. and Chesnokova, A.V. (Ed.) The Leading Practice of Decision Making in Modern Business Systems, Emerald Publishing Limited, Leeds, pp. 143-150. https://doi.org/10.1108/978-1-83867-475-520191016