Equilibrium with investors using a diversity of deviation measures

It has been argued that investors who optimize their portfolios with attention paid only to mean and standard deviation will all end up choosing some multiple of a certain master fund portfolio. Justification for the capital asset pricing model of classical portfolio theory, which relates individual assets to such a master fund, has come from this direction in particular. Attempts have been made to provide solid mathematical support by showing that the imputed behavior of investors is a consequence of price equilibrium in a market in which assets are traded subject to budget constraints, and optimization is carried out with respect to utility functions that depend only on mean and standard deviation.     

Estimating Recreational User Counts

This article outlines a methodology for estimating the number of individual visitors to a set of recreational sites, as well as counts of specific visitor groups. The model is designed for sets of sites characterized by: ( a ) unrestricted recreation from a wide and partially unknown geographic market; ( b ) individuals who may visit more than one site; ( c ) accurate visitation (gate) counts from each site. The model provides consistent estimates of the total number of individual visitors, based on information embedded in site-level count and survey data. Monte Carlo analysis and an empirical application illustrate the properties of visitor count estimates.     

Cost analysis of material handling systems in open pit mining: Case study on an iron ore prefeasibility study

Selection of the optimal material handling system is one of the most significant decisions to be made in mineral industries. Rapid economic changes and technological improvements make cost analysis a complicated process. On the other hand, current low commodity prices have put a greater emphasis on cost reduction and process optimization to ensure viability of mining projects. In this article, two material handling systems, a semimobile in-pit crusher and conveyor systems (IPCC) and traditional truck and shovel systems (TS), are compared through the cost analysis of an iron ore prefeasibility study. Furthermore, robustness of the design parameters is evaluated through a sensitivity analysis to determine the relative importance of project parameters. Finally, risks associated with uncertain design parameters affecting cost analysis are assessed through Monte Carlo simulation. The results indicated that IPCC is more cost effective than TS.     

Rural Amenity Values and Length of Residency

New residents of rural communities are often assumed to have preferences for development and conservation that differ from those of longer-term residents. However, the literature offers little to quantify presumed preference heterogeneity. This article assesses whether stated preferences differ according to length of residency. Results are based on a conjoint (choice experiment) survey of Rhode Island rural residents. Heterogeneity—according to length of town residency—is modeled using dummy variables, multiplicative interactions, and Lagrangian interpolation polynomials. Results are compared across the three models, and identify a range of attributes for which willingness to pay depends on length of residency.     

TAX BASIS AND NONLINEARITY IN CASH STREAM VALUATION

The value of a future cash stream is often taken to be its net present value with respect to some term structure. This means that a linear formula is used in which each future payment is discounted by a factor deemed appropriate for the date on which the payment will be made. In a money market with taxes and shorting costs, however, there is no theoretical support for the existence of a universal term structure for this purpose. What is worse, reliance on linear formulas can be seriously inaccurate relative to true worth and can lead to paradoxes of disequilibrium. A consistent no-arbitrage theory of valuation in such a market requires instead that taxed and untaxed investors be grouped in separate classes with different valuation operators. Such operators are linear to scale but nonlinear with respect to addition. Here it is established that although these valuation operators provide general bounds applicable across an entire class, individual investors within a tax class can have more special operators because of the influence of existing holdings. These customized valuation operators have the feature of not even being linear to scale. In consequence of this nonlinearity, investors from the same or different tax classes can undertake advantageous trades even when the market is in a no-arbitrage state, but such trade opportunities are limited. Some degree of activity in financial markets can thereby be understood without appeal to differences in utility functions or temporary disequilibrium due to random disturbances.     

Determinants of destination choice by Japanese overseas travelers

Using the data from the Japanese Pleasure Travel Survey, this study developed a logistic regression model to analyze destination choices of Japanese outbound pleasure travelers. The analysis revealed the effects of a number of variables on the Japanese destination choices. These variables are demographic characteristics including age, marital status, education level, and income, as well as types and purposes of trip. Various motivational factors were also found to be significant in classifying the Japanese market by their destination choices. The findings of this study provide useful information for destination marketers in their efforts to segment and target the Japanese outbound pleasure travel market. They will have a better understanding of the characteristics of the Japanese market relative to the strengths and weaknesses of their respective destinations, thus allowing them to be more effective in their packaging and promotion.     

Cash Stream Valuation In the Face of Transaction Costs and Taxes

The usual notion of every future cash stream having a net present value determined from a single term structure breaks down when transaction costs are taken into account, especially the sizable costs associated with short-borrowing. the difficulties are compounded by taxes, which can lead to paradoxes of disequilibrium if elementary NPV is assumed to be a rational basis for decision making. This paper systematically develops a theory of valuation which overcomes these shortcomings by accepting the multiplicity of no-arbitrage term structures that may be present for each tax class of investors, and uses the entire set of them to impute both a "long price" and a "short price" for every cash stream, regardless of the sign of the future payments. the valuation operators giving these prices are nonlinear but readily calculated from linear programming formulas.