Investment appraisal using quantitative risk analysis
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Updated: Sep 30, 2026

An R-Based Landscape Validation of a Competing Risk Model
Published on: September 16, 2022
1Department of Fire Safety Engineering, Lund University, P.O. Box 118, SE-22100 Lund, Sweden. henrik.johansson@brand.lth.se
Abstract:
Investment appraisal concerned with investments in fire safety systems is discussed. Particular attention is directed at evaluating, in terms of the Bayesian decision theory, the risk reduction that investment in a fire safety system involves. It is shown how the monetary value of the change from a building design without any specific fire protection system to one including such a system can be estimated by use of quantitative risk analysis, the results of which are expressed in terms of a Risk-adjusted net present value. This represents the intrinsic monetary value of investing in the fire safety system. The method suggested is exemplified by a case study performed in an Avesta Sheffield factory.
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