Fuzzy Engineering Economics with Applications (Studies in Fuzziness and Soft Computing, 233)

✍ Scribed by Cengiz Kahraman (editor)

• Publisher: Springer
• Year: 2008
• Tongue: English
• Leaves: 389
• Category: Library

✦ Synopsis

Fuzzy set approaches are suitable to use when the modeling of human knowledge is necessary and when human evaluations are needed. Fuzzy set theory is recognized as an important problem modeling and solution technique. It has been studied ext- sively over the past 40 years. Most of the early interest in fuzzy set theory pertained to representing uncertainty in human cognitive processes. Fuzzy set theory is now - plied to problems in engineering, business, medical and related health sciences, and the natural sciences. This book handles the fuzzy cases of classical engineering e- nomics topics. It contains 15 original research and application chapters including different topics of fuzzy engineering economics. When no probabilities are available for states of nature, decisions are given under uncertainty. Fuzzy sets are a good tool for the operation research analyst facing unc- tainty and subjectivity. The main purpose of the first chapter is to present the role and importance of fuzzy sets in the economic decision making problem with the literature review of the most recent advances.

✦ Table of Contents

Title Page
Preface
Contents
Fuzzy Sets in Engineering Economic Decision-Making
Introduction
Fuzzy Concepts in Engineering Economy
The Time Value of Money
Simple and Compound Interest Rates
Nominal and Effective Interest Rates
Continuous Compounding
Inflated Interest Rate
Interest Factors
Bibliography for Fuzzy Engineering Economic Analysis
Conclusions
References
Fuzzy Present Worth Analysis with Correlated and Uncorrelated Cash Flows
Introduction
Economic Concepts Review
Time Value of Money
Cash Flow
Equivalence Formulae
Techniques of Comparison
Arithmetic Operations over Fuzzy Numbers That Are Not Independent
Example of Financial Calculations
Comparing and Ordering Fuzzy Numbers
Independent Numbers
Dependent Fuzzy Numbers
Decision Issues
NPW Example 1
Fuzzy Case with Partial Correlation
NPW Example 2
References
Optimization with Fuzzy Present Worth Analysis and Applications
Introduction
Introductory Information - Crisp Present Value and Fuzzy Numbers
Crisp Present Value
Basic Definitions - Fuzzy Numbers
Fuzzy Present Value - Concept and Applications
Fuzzy Data
Calculation of Fuzzy Present Value and Fuzzy Net Present Value
Interpretation of Fuzzy Present Value and Fuzzy Net Present Value
Fuzzy and Probabilistic Approach to the Present Value
Fuzzy Net Present Value as Objective in Project Selection Problems
Applications to the Valuation of Projects with Future Options
Fuzzy Net Present Value as Objective in Optimization Problems from the Industry
Fuzzy Net Present Value as an Objective in Spatial Games
Fuzzy Classification Based on Net Present Value
Conclusions
References
Fuzzy Equivalent Annual-Worth Analysis and Applications
Introduction
Fuzzy Equivalent Uniform Annual Value Method
Ranking Methods
The First Ranking Method
The Second Ranking Method
Application
Analysis Period is Infinite
Conclusions
References
Case Studies Using Fuzzy Equivalent Annual Worth Analysis
Use of the A/P Factor
EAW Example 1
Crisp Case
Fuzzy Case
EAW Example 2
Crisp Case
Fuzzy Case
EAW Example 3
References
Fuzzy Rate of Return Analysis and Applications
Introduction
Crisp Internal Rate of Return
Fuzzy Internal Rate of Return
Conclusions
References
On the Fuzzy Internal Rate of Return
Introduction
A New Method for Solving of Interval Equations
Fuzzy IRR for the Crisp Interval Cash Flows-Basics
A Numerical Solution of the Non-linear Fuzzy Problem of $IRR$ Calculation
Possible Applications
Conclusion
References
Fuzzy Benefit/Cost Analysis and Applications
Introduction
Fuzzy Benefit/Cost Ratio Analysis
Discrete Compounding
Continuous Compounding
Ranking Methods
Applications
Application of Fuzzy B/C in Case of Continuous Compounding
Conclusions
References
Fuzzy Replacement Analysis
Introduction
Classical Replacement Analysis
Fuzzy EUAW
A Numerical Application: Operating System Selection with Fuzzy Replacement Analysis
Conclusion
References
Depreciation and Income Tax Considerations under Fuzziness
Introduction
Depreciation Methods
Straight Line (SL) Depreciation
Sum-of-Years Digits Depreciation
Declining Balance (DB)
Comparison of Depreciation Methods
Consideration of Depreciation and Tax under Fuzzy Case
Sum of Years Digits Depreciation
Straight Line (SL) Depreciation
Conclusions
References
Effects of Inflation under Fuzziness and Some Applications
Introduction
Relation between Inflation and Interest
Inflation Measurement
Impact of Inflation
Tax Consideration
Future Worth Calculations Adjusted for Inflation
Capital Recovery Calculations Adjusted for Inflation
Fuzzy Inflation-Adjusted Interest Rate
Fuzzy Inflation Rates and Present Worth Calculations
Fuzzy Inflation Rates and Future Worth Calculations
Fuzzy Inflation Rates and Capital Recovery Calculations
Some Applications
Conclusions
References
Fuzzy Sensitivity Analysis and Its Application
Introduction
Sensitivity Analysis of Differentiation of the Choquet Integral as an Aggregation Function in Data-Mining
Interval Limited Choquet Integral
Differentiation of the Choquet Integral
Sensitivity Analysis as an Aggregation Function in Data-Mining
Differentiation of t-Conorm Integral
Interval Limited t-Conorm Integral
Differentiation of t-Conorm Integral
Comparison with Differentiation of t-Conorm Integrals in Sensitivity Analysis of Aggregation Function in Data Mining
Apply to Credit Risk Analysis
Long Term Debt Rating Model
Simulation Result
Sensitivity Analysis Using Differentiation of the Choquet Integral
Conclusions
References
A Probabilistic Approach to Fuzzy Engineering Economic Analysis
Introduction
Probability Density Function from Membership Function
Proportional Probability Distribution
Uniform Probability Distribution
The Mellin Transform
Mellin Transforms for Selected Probability Functions
Engineering Economy Applications
Present Worth of Fuzzy Cash Flow Project
Comparing Alternatives with Fuzzy Cash Flow
Fuzzy Multi-attribute Automobile Selection (Dubois et al. 1988)
Concluding Remarks
References
Investment Analyses Using Fuzzy Decision Trees
Introduction
Decision Trees
Fuzzy Decision Trees
A Numerical Example
Investment Analysis Using Fuzzy Decision Trees
Conclusions
References
Fuzzy Multiobjective Evaluation of Investments with Applications
Introduction
Tool Steel Material Selection Problem
Subsethood Measure for Linguistic Representation of Fuzzy Numbers
Common Representation of Different Types of Local Criteria
Probabilistic Method For Fuzzy Values Comparison
Aggregation of Local Criteria and Aggregating Modes
Multiple Criteria Investment Project Evaluation in the Fuzzy Setting
Local Criteria Building
Ranking of Local Criteria
Numerical Evaluation of the Comparing Investment Projects
Hierarchical Structure of Local Criteria
Conclusions
References
Using Fuzzy Multi-attribute Data Mining in Stock Market Analysis for Supporting Investment Decisions
Introduction
Preliminaries
Basic Concepts
FSQL: A Language for Flexible Queries
Fuzzy Functional Dependencies and Gradual Functional Dependencies
Applying FSQL to Obtain Fuzzy Extended Dependencies
Fuzzy Extended Dependencies with FSQL Operators
Obtaining Fuzzy Extended Dependencies from a Database by Using FSQL
Applying a Fuzzy Data Mining Process to Stock Market
Earning Sceneries Identification and Expert’s Theory Formulation
Expert’s Theory Validation through FEDs Using FSQL
Conclusions
References
Soft Decision Support Systems for Evaluating Real and Financial Investments
Introduction
The Basics of Fuzzy Sets and Fuzzy Numbers
Fuzzy Sets
Fuzzy Numbers
The Extension Principle
Normative Measures on Fuzzy Numbers
Soft Decision Support for Financial Investments
Utility Function for Ranking Portfolios
Possibility Theory in Portfolio Selection
A Possibilistic Approach to the Portfolio Selection Problem
Algorithm for Solving the Possibilistic Portfolio Selection Problem
Soft Decision Support for Strategic Investment Planning
Practical Background
Possibility Theory in Strategic Investment Planning
Fuzzy Net Present Value Analysis
Fuzzy Real Option Valuation
References
Pricing Options, Forwards and Futures Using Fuzzy Set Theory
Introduction
Pricing Options
Binomial Model
Black-Scholes Model
Pricing Forwards and Futures
Crisp Pricing Forwards/Futures
Fuzzy Pricing Forwards/Futures
Summary and Conclusions
References
Fuzzy Capital Rationing Models
Introduction
Uncertainty-Based Approaches to Capital Rationing Models
Stochastic and Robust Approaches to Capital Rationing Model
Fuzzy Capital Rationing Models
Conclusions
References
Future Directions in Fuzzy Engineering Economics
Index
Author Index