English (United Kingdom)

https://curated-unify.zendy.io/wp-json/zendy-region/v1/featured_content/oa?rat=en

https://curated-unify.zendy.io/wp-json/zendy-region/v1/highlighted_journal/

Global: Zendy Plus annual

Presents the access of premium content as premium feature

Premium Content

Presents the keyphrase highlighting as premium feature

Keyphrase Highlighting

Presents the summarisation as premium feature

Summarisation

Insights

Presents the pdf analysis as premium feature

PDF Analysis

Presents the zaia usage as premium feature

ZAIA

Global: Zendy Tools annual

Global: Zendy Free Plan

Global: Zendy Tools monthly

Global: Zendy Plus monthly

We develop a complete analysis of a general entry-exit-scrapping model. Inparticular, we consider an investment project that operates within a randomenvironment and yields a payoff rate that is a function of a stochasticeconomic indicator such as the price of or the demand for the project's outputcommodity. We assume that the investment project can operate in two modes, an"open" one and a "closed" one. The transitions from one operating mode to theother one are costly and immediate, and form a sequence of decisions made bythe project's management. We also assume that the project can be permanentlyabandoned at a discretionary time and at a constant sunk cost. The objective ofthe project's management is to maximise the expected discounted payoffresulting from the project's management over all switching and abandonmentstrategies. We derive the explicit solution to this stochastic control problemthat involves impulse control as well as discretionary stopping. It turns outthat this has a rather rich structure and the optimal strategy can take eightqualitatively different forms, depending on the problems data.

An Investment Model with Switching Costs and the Option to Abandon