Finance and Credit

Modeling of efficiency of investments in agrarian business

Vol. 24, Iss. 7, JULY 2018

Received: 30 May 2018

Received in revised form: 13 June 2018

Accepted: 27 June 2018

Available online: 27 July 2018

Subject Heading: INVESTING

JEL Classification: G17, G32, Q14

Pages: 1609–1620

Samygin D.Yu. Penza State University, Penza, Russian Federation

Keleinikova S.V. Saransk Institute of Cooperation, Branch of Russian University of Cooperation, Saransk, Republic of Mordovia, Russian Federation

ORCID id: not available

Importance This paper raises the strategic problem of significant increasing the investment attractiveness of agricultural business. It is largely due to the lack of quality tools to support the making of investment decisions on agriculture.
Objectives The article aims to systematize investment tools, substantiate and develop strategic models for supporting investment decisions in agricultural business.
Methods This research involves the method of financial management and econometric models for assessing the effectiveness of investments.
Results The work constructs the functional dependence of the yield spread on invested capital in agrarian business. Considering the Penza oblast as a case study, we have carried out the necessary model and analytical calculations. The model shows the existing stimulus to invest capital in rural business and the potential for increasing the efficiency of investment in agricultural business.
Conclusions and Relevance It is expedient to use financial tools to justify the effectiveness of potential investments and visualize the return of invested capital to agricultural business. It will help adjust the current agricultural policy to attract additional financial resources to agriculture.

Keywords: agrarian business, investment attractiveness, invested capital, economic value added, weighed average capital cost, yield spread


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