How do you make decisions about business investments when the outcome and likely cash flows are almost unknowable? A new tool, real options analysis is now being used by firms like Merck and Shell. Professor Hevert explains how real options work, why it differs from older financial analysis and how it can be used to help make better decisions on highly risky multi-phase investments, such as drug or new technology development and oil exploration.

Kathleen Hevert, Prof. Kathleen Hevert;