The paper aims to develop an evaluation model of Civil Aircraft R&D project Risk. The study reviews the past literature and analyses the possible option type in civil aircraft research process. The Binomial Option Tree Model is discussed in the follow section. The uncertainty of R&D project and its influence on risk was analyzed. Then the paper proposes a risk evaluation model with the Binomial Option Tree Model and Monte Carlo simulation method. Finally, the model is validated by the case

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... . The results show it is a feasible approach. KEYWORD: Binomial Option Tree Model, Risk Evaluation, Monte Carlo simulation INSTRUCTIONS Myers, S.C (1984) defined the real option and developed the pricing model 1 . Then Black、Scholes(1973) 2 and Merton(1973) 3 developed the B-S option pricing model. The Cox etc. developed the classical binomial option tree pricing model 4 . Margrabe(1978) study the assets swap problem in option pricing model 5 . Stuz (1982) analyses the Min & Max problem in option pricing model 6 . Tourhinho (1979) report the pricing model for natural resources 7 . Based on his study, Brennan and Schwartz(1985) build an evaluation model to analyse the profit maximization problem of the copper mine project 8 . Herbelot(1992) build another model to analyse the electric investment project 9 . Martzoukos and Teplitz-Sembitzky (1992) analyse the future uncertainty in electric investment project, and indicate the value of the new _____________