Decision-making on IPO implementation under conditions of uncertainty

Abstract

The theory of corporate financing considers the decision-making on the implementation of the IPO as one of the most important decision-making problems in the life-cycle of the undertaking. In addressing this decision-making task, however, are often not known all the necessary information – the likelihood of each condition. In a situation where we know only the fuzzy probabilities of certain states, it is appropriate to use quantitative methods, for example fuzzy linear programming. The aim of the contribution is to show on a case study use of the decision tree for deciding on the implementation of the IPO. Case study is divided into two parts. In the first part are known all the probabilities of each state, in the second part is known the likelihood of only some of the states, moreover, these probabilities are entered quite freely.