Article
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The Purpose of Project Economic Models
Version 1
: Received: 4 April 2017 / Approved: 5 April 2017 / Online: 5 April 2017 (18:09:25 CEST)
How to cite: Omoregie, U. The Purpose of Project Economic Models. Preprints 2017, 2017040031. https://doi.org/10.20944/preprints201704.0031.v1 Omoregie, U. The Purpose of Project Economic Models. Preprints 2017, 2017040031. https://doi.org/10.20944/preprints201704.0031.v1
Abstract
Models come in different forms: visual, arithmetic, mental, physical. The most common type of model is arguably the mental model, which people use to view and interpret the world. A model can be described as a representation of a problem or a situation – a simplified representation. The process of building or developing a model is called modeling. A model once developed by the modeller, can be ‘owned’ by a manager or decision maker. The ideal is to make the model an extension of the user’s ability to think about and analyse problems or situations. When used properly – taking into consideration its limitations – an economic model for a project can provide insight for decision makers, when making the crucial decision to approve a project. An economic model for a liquefied natural gas (LNG) project is shown as an example.
Keywords
Models; Projects; Modelling; Quality Assurance
Subject
Business, Economics and Management, Economics
Copyright: This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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