Multi-parametric simulation of a model of nonconventional public projects evaluated by cost-benefit analysis

The paper will deal with simulation of cash-flows of investment character public projects subsidized from public funds. In the model of a project, the influence of changes in the amount of subsidy and changes of economic cash-flows generated by the project on the result of public investment social efficiency evaluation will be examined by the economic internal rate of return (ERR) method. The constructed deterministic model based on a rational fractional function will be used to examine the characteristics of projects when alternation of positive and negative cash-flows occurs in the course of an investment process. For modelling the project, we will use the EU methodology for assessing socio-economic evaluation of project utility by means of cost-benefit analysis issuing from Kaldor-Hicks social optimality test. Using the Maple program, the simulation of individual scenarios of nonconventional projects will be presented in 3D presentation and assessed by means of the value of the root function in relation to project parameters. The analysis of results by the simulation of public project scenarios will be interpreted in relation to economic conditions possible in real life.