A suggested mathematical model for project financial performance evaluation

Abstract EN

Due to the fact that investment project contribute to the economic process in general, it is necessary to select the more profitable one based on performance.

The purpose of this study is to suggest a mathematical model to measure the financial performance of economic firms, whether the model is economically viable along with its assumptions, or in measuring such performance through the used controlling criterion.

The suggested model contributies to evaluate such performance fundamentally, and achieving acceptable results, away from personal judgment and to help in the decision making process to choose the most profitable project.

The researcher used what is called the “Statistical Package of Social sciences” (SPSS) to measure the financial performance.

One example of this type of measurement is the use of “Factor Analysis”, as a method used to analyze number of variables (Financial Ratios) and relations.

(SPSS) is the most suitable computer software, which helps users to grasp and understand the suggested mathematical model and removes the often burdensome of time consuming and effort.

The empirical results indicate the logic of the model in measuring a firm’s financial performance, is due to its dependency on concepts used in the fields of finance and statistics.

The study also reveals that the model may be considered as a predictor for a firm’s financial performance in the future.