Profitability evaluation of dynamic investment projects by using ordered fuzzy numbers

The objective of this paper is to introduce a fresh approach for incorporating uncertainty into the assessment of investment project profitability. In the real world, capital budgeting problems are frequently accompanied by uncertainty and risks arising from dealing with imprecise data. The primary contribution of this research lies in the development of a novel method for evaluating the profitability of investment projects under uncertain conditions. To begin, we present a new discounting method that investors can utilize to make informed investment decisions. Specifically, we have devised a novel approach for assessing the profitability of investment projects using the concept of ordered fuzzy net present value (OFNPV). Additionally, we employ ordered fuzzy numbers (OFN) to depict the dynamics of changes in the defined investment parameters over the assumed time horizon. By harnessing ordered fuzzy numbers, we create an effective tool for evaluating the profitability of investment projects. This assessment tool not only empowers decision-makers to make choices under uncertain conditions regarding the feasibility of a given investment project, but also aids in the selection of the most promising project, such as one with the highest expected probability of success.