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Economic Analysis: Theory and Practice
 

Estimating the efficiency of investments with consideration of effects in related fields

Vol. 15, Iss. 6, JUNE 2016

PDF  Article PDF Version

Received: 19 April 2016

Accepted: 16 May 2016

Available online: 28 June 2016

Subject Heading: INVESTMENT ANALYSIS

JEL Classification: O32

Pages: 4-13

Lyubushin N.P. Voronezh State University, Voronezh, Russian Federation
lubushinnp@mail.ru

Nazarov V.G. OOO Research and Production Center Epsilon, Nizhny Novgorod, Russian Federation
nazarov-1952@list.ru

Kishev S.A. OOO Certification Center Svarka, Nizhny Novgorod, Russian Federation
skishev@inbox.ru

Subject The article discusses the impact of the effect from introducing new construction materials required to develop complex high-tech products in related fields (repair and disposal of the product as a whole) on the economic benefit from the product introduction.
Objectives The study's objective is to refine the calculation of economic effect from the new construction materials introduction through considering the effects in related areas like repairs and disposal of the product at different rates of discounted cash flows.
Methods The methodology draws on the concept of life cycle of systems, which is based on CALS-technologies. The developed technique employs methods of investment analysis, as well as comparison, analogy and expert evaluation.
Results The paper shows the transformation of production and technological relations of the product's life cycle into the production and technological relations of the life cycle of the new construction material. We made calculations and applied cash flows of the life cycle of new construction material on the cash flow curve of the life cycle of material used in repair and disposal of products. This enabled to refine the calculation of economic benefit.
Conclusions We obtained a minor increase in the economic effect, which is explained by a low share of cash flows from the use of new materials in the sum of discounted revenues from repair, and a negative value from disposal, especially at high rate of discount.

Keywords: investment, construction materials, life cycle, rate of discount, related fields

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