An Application of Dynamic Programming to Capital Investment Decision Analysis.
FEDERAL AVIATION ADMINISTRATION WASHINGTON D C OFFICE OF AVIATION POLICY AND PLANS
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The report describes a method of evaluating capital investment decisions that use the dynamic programming concept. Dynamic programming is an operations research technique that is effective in solving multistage decision problems. The dynamic programming process reduces many elaborate problems into a form that may be readily solved provided the original problem is not excessively complicated. The particular problems discussed in the report concern the identification of an optimum capital investment decision. Typically, the problem involves the selection of a capital investment decision from a group of competing or alternative investment decisions. The method proposed in the report determines the discounted present worth value of the costs associated with each capital investment decision. Author
- Operations Research
- Air Navigation and Guidance