The Research of Economic Evaluation Project Risk Based on Monte Carlo Simulation

In this paper, the Monte Carlo simulation method is applied to the economic evaluation of construction project. By using multi-element variation analysis method, we can directly deal with the uncertain risk elements and describe the uncertainty in the form of probability, after using the independent simulated tests on the economic evaluation project N times, we can get the results to predict and analyze the risk of the economic evaluation project. It provides a quantitatively feasible method to analyze the project risk. In the end of this paper, the simulation analysis of NPV and IRR in a construction company project is applied to testify the validity of this method.