Operational asset replacement strategy : a real options approach

This article analyses the problem of replacement by investigating the optimal moment of investment replacement in a given tax environment with a given depreciation policy. An operation and maintenance cost minimization model, based on the definition of equivalent annual cost, is applied to a real options paradigm. The developed methodology allows for an innovative evaluation of the flexibility of replacement process analysis. A new two- factor evaluation function is introduced to quantify decisions of asset replacement under a unique cycle environment. This study improves upon previous findings in the literature as it accounts for autonomous salvage value processes. Based on partial differential equations, this model achieves a general analytical solution and particular numerical solution. The results differ significantly from those observed in one-factor models by showing evidence of over-evaluation in optimal levels of replacement, and by confirming suspicions that different types of uncertainties produce non-monotonous effects on the optimal replacement level. The scientific contribution of this study lies in new and stronger approaches to equivalent annual cost literature, supplying an algorithm for operation and maintenance cost minimization that is conditioned by autonomous salvage value. This study also contributes to the real options literature by developing of a two-factor model with Brownian processes applied to asset replacement.info:eu-repo/semantics/publishedVersio

Existentially Closed Models and Conservation Results in Bounded Arithmetic

We develop model-theoretic techniques to obtain conservation results for first order Bounded Arithmetic theories, based on a hierarchical version of the well-known notion of an existentially closed model. We focus on the classical Buss' theories Si2 and Ti2 and prove that they are ∀Σbi conservative over their inference rule counterparts, and ∃∀Σbi conservative over their parameter-free versions. A similar analysis of the Σbi-replacement scheme is also developed. The proof method is essentially the same for all the schemes we deal with and shows that these conservation results between schemes and inference rules do not depend on the specific combinatorial or arithmetical content of those schemes. We show that similar conservation results can be derived, in a very general setting, for every scheme enjoying some syntactical (or logical) properties common to both the induction and replacement schemes. Hence, previous conservation results for induction and replacement can be also obtained as corollaries of these more general results.Ministerio de Educación y Ciencia MTM2005-08658Junta de Andalucía TIC-13

Optimizing a general optimal replacement model by fractional programming techniques

In this paper we adapt the well-known parametric approach from fractional programming to solve a class of fractional programs with a noncompact feasible region. Such fractional problems belong to an important class of single component preventive maintenance models. Moreover, for a special but important subclass we show that the subproblems occurring in this parametric approac

Strong Laws for Urn Models with Balanced Replacement Matrices

We consider an urn model, whose replacement matrix has all entries nonnegative and is balanced, that is, has constant row sums. We obtain the rates of the counts of balls corresponding to each color for the strong laws to hold. The analysis requires a rearrangement of the colors in two steps. We first reduce the replacement matrix to a block upper triangular one, where the diagonal blocks are either irreducible or the scalar zero. The scalings for the color counts are then given inductively depending on the Perron-Frobenius eigenvalues of the irreducible diagonal blocks. In the second step of the rearrangement, the colors are further rearranged to reduce the block upper triangular replacement matrix to a canonical form. Under a further mild technical condition, we obtain the scalings and also identify the limits. We show that the limiting random variables corresponding to the counts of colors within a block are constant multiples of each other. We provide an easy-to-understand explicit formula for them as well. The model considered here contains the urn models with irreducible replacement matrix, as well as, the upper triangular one and several specific block upper triangular ones considered earlier in the literature and gives an exhaustive picture of the color counts in the general case with only possible restrictions that the replacement matrix is balanced and has nonnegative entries.Comment: The final version. To appear in Electronic Journal of Probabilit

A kinetic equation for spin polarized Fermi systems

This paper a kinetic Boltzmann equation having a general type of collision kernel and modelling spin-dependent Fermi gases at low temperatures modelled by a kinetic equation of Boltzmann type. The distribution functions have values in the space of positive hermitean 2x2 complex matrices. Global existence of bounded weak solutions is proved in L1 to the initial value problem in a periodic box.Comment: Replacement with extended results, to appear in Kinetic and Related Model

Labor Market Policies and Equilibrium Employment : Theory and Application for Belgium

This paper is concerned with the general equilibrium effects of active labor market programs and the unemployment insurance system (the replacement ratio and the level of sanctions). It develops an equilibrium job matching model where active programs and the rate of sanctions have an amiguous impact on the equilibrium employment rate. The model is simulated for Belgium. The simulations suggest that passive and active labor market policies do not have a substantial net impact on the employment rate.labor market policies; sanctions; equilibrium search model; matching function

Reoptimizations in linear programming

Replacing a real process which we are concerned in with other more convenient for the study is called modeling. After the replacement, the model is analyzed and the results we get are expanded on that process. Mathematical models being more abstract, they are also more general and so, more important. Mathematical programming is known as analysis of various concepts of economic activities with the help of mathematical modelsReoptimization, linear programming, mathematical model