Developing a Risk Assessment Model Based on Time Value of Money and Cost-Benefit Ratio in Construction Projects
Journal of Civil, Construction and Environmental Engineering
Volume 2, Issue 2, April 2017, Pages: 34-43
Received: Jan. 24, 2017; Accepted: Feb. 20, 2017; Published: Mar. 3, 2017
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Authors
Roghaye Mousazade, Department of Civil Engineering, Faculty of Engineering, South Tehran Branch, Islamic Azad University, Tehran, Iran
Abbas Mahmoudabadi, Department of Industrial Engineering, Mehr Astan University, Guilan, Iran
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Abstract
In the present paper, a cost-risk and income-risk evaluation model has been developed in order to evaluate the risks of cost and incomes those may happen in construction projects. Since, it is important to determine risk factors for different activities and stages of various projects; the main aim is to propose an evaluation model for estimating the present value of risks corresponding to costs and incomes of the construction projects. The estimating procedure which has been proposed in this research work is that a project is broken into stages and related activities and the present value of cost and income risks as well as the value of different risk groups are calculated and compared to three pre-defined risk categories. Utilizing the proposed procedure using experimental data gathering for a under construction primary school building shows that the proposed model can help decision makers to determine and assess the risks of cost and incomes over the project activities. In addition, using the proposed procedure helps them to talk about how to deal with those risks to be reduced, accepted or transferred to other project components.
Keywords
Time, Cost, Risk, Time Value of Money, Cost-Benefit Analysis
To cite this article
Roghaye Mousazade, Abbas Mahmoudabadi, Developing a Risk Assessment Model Based on Time Value of Money and Cost-Benefit Ratio in Construction Projects, Journal of Civil, Construction and Environmental Engineering. Vol. 2, No. 2, 2017, pp. 34-43. doi: 10.11648/j.jccee.20170202.11
Copyright
Copyright © 2017 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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