We apply a utility–based method to obtain the value of a finite–time investment opportunity when the underlying real asset is not perfectly correlated to a traded financial asset. Using a discrete–time algorithm to calculate the indifference price for this type of real option, we present numerical examples for the corresponding investment thresholds, in particular highlighting their dependence ...

The current extensive literature on irreversible investment decisions makes the assumption of constant interest rate. In this paper we study the impact of interest rate and revenue variability on the decision to carry out an irreversible investment project. Given the generality of the considered valuation problem, we first provide a thorough mathematical characterization of the problem and deve...

The majority of previous studies on investment evaluation of RFID technology ignore the flexibility and the Real Options that this kind of investment can lead to. However, studies on the evaluation of other Information Systems have acknowledged the importance of these options as they create future business opportunities or give to managers the opportunity to take actions that could favorably in...

This paper reassesses the burden of the current U.S. international tax regime and reconsiders well-known welfare benchmarks used to guide international tax reform. Reinventing corporate tax policy requires that international considerations be placed front and center in the debate on how to tax corporate income. A simple framework for assessing current rules suggests a U.S. tax burden on foreign...