GA-Fuzzy Financial Model For Optimization of A BOT Investment Decision

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Title GA-Fuzzy Financial Model For Optimization of A BOT Investment Decision
Author Islam, MD Mainul; Mohamed, Sherif Ali Mohtady
Publication Title Accelerating Innovation in Engineering, Management and Technology
Editor Syed M. Ahmed, Salman Azhar, Sherif Mohamed
Year Published 2007
Place of publication Miami, Florida
Publisher Florida International University
Abstract Financial modeling for investments to build/operate/transfer (BOT)-type projects is essentially intricate. The complexity stems mainly from two folds: multi-party involvement and uncertainty. Promoters need a systematic means for objective evaluation of financial performance measures in order to examine whether a certain level of profit margin and an attractive financial proposal to clients, are possible. A clear research gap is perceived in simultaneous evaluation of profitability and bid-winning potential from the promoters' perspective. By using a combination of genetic algorithms and the fuzzy set theory, an intelligent algorithm, is developed for optimization of conflicting financial interests in deriving the right mix of three key decision variables: equity ratio, concession length, and base price. Fuzzy sets are used to explicitly incorporate uncertainty in estimating economic and financial parameters due to lack of available data. Genetic algorithms is used for solving corresponding fuzzy objective function coupled with multiple constraints. A case study from prevailing literature demonstrates the excellent capability of the developed model to produce optimal financial scenario under uncertainty.
Peer Reviewed Yes
Published Yes
Publisher URI http://www.fiu.edu/~citc/citc4/index.htm
Alternative URI http://www.fiu.edu/~citc/
Copyright Statement Copyright 2007 CITC-IV, USA. The attached file is reproduced here in accordance with the copyright policy of the publisher. Use hypertext link for access to conference website.
ISBN 1-884342-02-1
Conference name Fourth International Conference on Construction in the 21st Century (CITC-IV)
Location Gold Coast
Date From 2007-07-11
Date To 2007-07-13
URI http://hdl.handle.net/10072/18337
Date Accessioned 2007-09-25
Date Available 2009-01-16T06:23:03Z
Language en_AU
Research Centre Centre for Infrastructure Engineering and Management
Faculty Faculty of Science, Environment, Engineering and Technology
Subject PRE2009-Building Construction Management
Publication Type Conference Publications (Full Written Paper - Refereed)
Publication Type Code e1

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