Evaluation of Upgrading Corporate Equipment as an Asian Real Option

A method for handling the problem of financial mission statement has been suggested to evaluate effects of projected upgrading equipment of a manufacturing company. For this end, such project is analyzed as an Asian real option with constant business volatility. The problem is solved using the Black-Scholes model, a refined and modified binomial model and a modified trinomial model. It has been demonstrated that the most accurate valuation of the option and the entire project in general is provided by the trinomial model