Choosing Innovation Projects
- What are the advantages and disadvantages of discounted cash flow methods such as NPV and IRR?
- For what kind of development projects might a real options approach be appropriate? For what kind of projects would it be inappropriate?
- Why might a firm use both qualitative and quantitative assessments of a project?
- Identify a development project you are familiar with. What methods do you believe were used to assess the project? What methods do you believe should have been used to assess the project?
- Will different methods of evaluating a project typically yield the same conclusions about whether to fund its development? Why or why not?
