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Abstract

A common method used for evaluation of investment projects is the Cost Benefit Analysis (CBA). Desiring to have insight into the core of investment, the optional modules with real options are becoming more in use, which represent the stochastic approach. The basic purpose of this research was therefore to display applications of methods real options in agriculture. Results of the traditional CBA with the parameter NPVt showed the production of processed potatoes in cubes is the most suitable. For the assessment of real options investment projects of processing potatoes the Black Scholes model have been used further used. Option value (OV) to the Black-Scholes (BS) model show positive values for all three types of processing (french fries, slices and cubes). However, real options have important value, because the traditional methods of investment analysis are upgraded to the methods of real options with stochastic terms.

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