Improvement Of Financial Evaluation Indicator Of Investment Project And Decision-Making Method

Financial evaluation of Investment project is an important part in technical economic feasibility evaluation. It is an estimate and pre-evaluation for economic profit after the completion of the project and it is a standard for comparison and selection of some projects, and it is basis of the decision-making and management. The perfection of the financial evaluation indicator of investment project and the effectiveness of the decision-making method will have a significant impact on the outcome of the technical economic feasibility evaluation of the investment project. Because of some deficiencies for our financial evaluation indicator of investment project and the decision-making method, this important economic means have not been properly applied, and it due role have not been fully played.This paper is on the basis of research background and present situation. It puts forward Chinese current financial evaluation indicators of investment project and decision-making method have some shortcomings, and amends respectively the deficiencies: In view of the current financial evaluation indicators of investment project having not taken into account factor comprehensively when calculating, it identifies and analyzes the objective situation of affecting these factors, adjusts timely the calculating formula of the indicators. Financial evaluation indicators of investment project are commonly used in the net present value, internal rate of return and investment payback period. To analyze the probable conflict in the contradict programme and find out the reasons for the conflict and put forward the corresponding decision-making methods. Because the traditional investment decision-making methods have some deficiencies under the uncertain situation, introduce Real Option theory, and amend the traditional investment decision-making method under the three options.