• Journal of the Korean Institute of Gas
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• v.22 no.2
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• pp.21-28
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• 2018

In recent years, payability of shale gas production has worsened due to oil and gas price declines resulting from sharply increasing shale gas production. Reliable economic evaluation in shale gas development has become important. In this study, Monte Carlo simulation of probabilistic analysis technique was applied to analyze the economic feasibility considering the uncertainty involved in shale gas development. For this, the range of major variables is set and a random number is generated to derive the probability distribution of Net Present Value(NPV) and Internal Rate of Return(IRR). Consequently, we estimated the probability that the feasibility of the project is evaluated to be positive when developing shale gas in the study area. In addition, sensitivity analysis of major parameters affecting economic efficiency in shale gas development was carried out, and the effect of major variables in economic evaluation for commercial production was identified. In the future, this study could be used to make decision for shale gas production by presenting the range of variation of economic index and probability value.

• The Journal of Fisheries Business Administration
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• v.43 no.3
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• pp.31-41
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• 2012

This paper was conducted to study the economic valuation for Nursery-Phase production of the tidal flat oyster in Korea. Benefit-cost(B/C) model used to indicate the effects of economic valuation. Using discounting rates(i.e., 4.5%, 6.5% and 8.5%), the model compared revenues and costs that occur at different times from 2012 to 2018. This study also estimated various submodels, which are Benefit Cost Ratio(B/C ratio), Net Present Value(NPV), Internal Ration of Return(IRR), to compare profit of Nursery-Phase production styles and analyzed returns to evaluate the scenarios. Sensitivity analysis were conducted for various scenarios. The results suggest as follows. First, the oyster spat to the shell height of 3~5cm was more profit than the shell height of 1~3cm. Second, all of sensitivity analysis with submodels were economic valuation such that B/C ratio > 1, NPV > 0 and IRR > discounting rate. Third, the payback period was about 3years after installed Nursery-Phase production system.

• Journal of Satellite, Information and Communications
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• v.7 no.1
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• pp.13-20
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• 2012

Despite of growing concern for developing meteorological satellites, poor investment has been realized to acquire effective and efficient satellite image processing technologies. In this study, not only qualitative exploration on mapping each elementary technology into related industries but quantitative inter-industry analysis induced from Total Cost of Ownership (TCO) of the Korean satellite image processing system were performed. Furthermore, economic assessment has been made by estimating internal rate of return(IRR) for the benefits returned versus TCO of the system. The results showed that agriculture and fisheries industry, tourist and leisure industry, and transportation industry were highly related with the acquisition of the system, and that 9.1 billion won of production-induced effects, 3.3 billion won of value-added-induced effects, and 54 individuals of employment-induced effects were anticipated except for those of directly relevant industries. Even in the pessimistic scenario, 7% of IRR exceeding 5.5% assumed as current public rate was postulated, consequently, the investment was fairly justified.

• Journal of Environmental Policy
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• v.10 no.2
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• pp.61-92
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• 2011

We analyzed the efficiency of environment investments by taking examples of central government's environmental investment (CGEI hereafter) and investment in prevention of environmental pollution (IPEP hereafter). We expanded the scope of existing studies by decomposing the internal rate of return (IRR hereafter) and present value of benefit (Bpv hereafter) into variable cost (VC hereafter) reduction, investment cost reduction (STC-VC hereafter), and rent. And we found that Bpv checks only the magnitude of benefit, while IRR indicates the existence of efficiency by investigating short-run total cost (STC hereafter) reduction and rent. Finally, by analyzing investment efficiency and changing benefit with respect to CGEI and IPEP through the investment efficiency methodology that compares IRR with market interest rate, we executed retrospective benefit-cost analysis. Accordingly, CGEI and IPEP are not efficient. However, IPEP is even more inefficient than CGEI.

• Journal of Korean Society of Industrial and Systems Engineering
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• v.2 no.2
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• pp.53-62
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• 1979

A widely accepted indicator of a project's economic potential is the internal rate of return (IRR). The primary objective of feasibility analysis for any project is to measure the economic potential for the project, normally defined as the expected return on capital investment. The analysis should be designed to determine whether a project is technically and economically sound, and under what conditions. Therefore, there are factors other than economic potential that must be taken into account in the reasonable composition of an investment program. These kinds of factors can be given proper consideration in project selection after the economic feasibility of alternative projects has been determined. The primary reason for having to choose among different projects is that capital resources are scare : the investment budget is limited. The case project, casting facilities investment project, treated in this paper were selected for their value in illustrating the methods of feasibility analysis. This case project an actual potential project and is analyzed on the basis of the best available data for the specific conditions for that project.

• Journal of Korean Society for Quality Management
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• v.40 no.1
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• pp.39-48
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• 2012

An early detection system for warranty issues periodically collects customers' claim data and automatically reports alarms about emerging issues based on statistical algorithms. It helps companies to reduce an issue definition time and save the handling cost of warranty claims. This paper provides an evaluation framework to validate the economic effect of an early detection system project. For this purpose, we present economical index of a project with explicit formulas such as ROI(return on investment), PP(payback period), NPV(net present value), PI(profitability index) and IRR(internal rate of return) and analyze the sensitivities of the index according to the variation of project input parameters. The proposed analysis framework is expected to be used for evaluating economic values of various system integration projects.

• Journal of Environmental Science International
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• v.14 no.2
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• pp.251-258
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• 2005

Statistical analysis between operating parameters and effluent quality on advanced wastewater treatment plant was performed. Through factor analysis four factors derived varimax rotation were selected each plant. Four components explained $80\%,\;82\%$ of the total variance of the process, respectively. The components on MLE plant were identified in the following order: 1) HRT increase and BOD load decrease by influent decrease, 2) Biomass, 3) SVI increase by internal return increase, 4) Microbial diversity by SRT increase. On $A_2O$ plant, we defined them as follows: factor 1, high MLSS by return rate increase, HRT increase by influent decrease; factor 2, biomass; factor 3, BOD of influent; factor 4 was relate to DO.

• IE interfaces
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• v.1 no.2
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• pp.1-12
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• 1988

A justification methodology which evaluates the tactical aspects of an FMS project is proposed. For evaluation of quantifiable tactical costs/savings a method of internal rate of return on incremental investment is developed while for the tactical ones which are difficult to quantify a weighted factor scoring model is proposed.

• Journal of Agricultural Extension & Community Development
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• v.28 no.4
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• pp.167-174
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• 2021

This study analyzed the feasibility of custom work service to deal with the imbalance of farm labor supply due to population aging. The economic feasibility analysis is based on the case of Bonghwang-myeon in Naju-si, where the majority of farm work is entrusted to local agricultural cooperative. To assess the project profitability and economic feasibility based on the projected cash flow for the next ten years, Return On Investment (ROI), Net Present Value (NPV), and Internal Rate of Return (IRR) of the projects were calculated. The results showed that ROI is estimated at 13.7%, and NPV and IRR are KRW 1,504,932,000 and 15.6%, respectively, with a discount rate of 4.5%, indicating a good enough profitability. Furthermore, a sensitivity analysis with government support as part of an assumption showed that without the support, NPV turns negative, implying that the project is not profitable, and that government support for at least 30% of the cost is needed to secure the economic feasibility of a project. Hence, to promote agricultural work entrustment, it is necessary for the government to partly support the agricultural machinery and facility costs, which require a considerable amount of initial investment.

• Journal of Environmental Policy
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• v.2 no.2
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• pp.41-63
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• 2003

CDM(Clean Development Mechanism) project is said to be a mechanism, which profits both the investing country and the host country, while additionally contributing to the reduction of greenhouse gases of the earth as a whole. However in reality, most of the proposed projects do not end up in agreement because of the problems related to differences in recognition between the investing country and the host country of the CDM project. This outlines the background for this research which proposes a new design of institutional arrangements of CDM projects in the Northeast Asian region, mainly Japan, China and Korea. In addition, we investigate the feasibility of the proposed design. The research firstly focuses on the reduction in transaction costs that the participation of Korea will have on a Japan-China CDM project. This paper further emphasizes the potential gains that would materialize if a CDM project involved the whole Northeast Asian region, and not only one country. Our research suggests that an approximate reduction of 23% in transaction costs, and about 4% reduction in the total costs of a CDM project can be expected to follow the Korean participation. In addition to decreasing costs we find that a Korean involvement in a CDM project with Japan will lead to efficiency gains illustrated by a higher increase in the IRR(Internal rate of return) in a Japan-Korea project(11.45% to 12.21%) compared to an IRR incresement of 10.57% to 11.27% for a pure Japanese CDM project. Similar results of a rise in the IRR is found for the whole investment period of 20 years. We can hence conclude that Korean participation in a Japan-China CDM project would improve the implementation possibilities of CDM project in the Northeast Asia region.