Open AccessDynamic model of real investment with lags
Author(s) -
I. V. Lutoshkin,
Nailya Rinatovna Yamaltdinova
Publication year - 2019
Publication title -
journal of physics. conference series
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.21
H-Index - 85
eISSN - 1742-6596
pISSN - 1742-6588
DOI - 10.1088/1742-6596/1353/1/012128
Subject(s) - maximum principle , profit maximization , pontryagin's minimum principle , profit (economics) , maximization , mathematical optimization , revenue , optimal control , investment (military) , total revenue , economics , dynamic programming , mathematics , mathematical economics , microeconomics , finance , politics , political science , law
The dynamic optimal control problem of corporation’s real investment in case of a limited budget is analyzed. Initial optimization problem is formulated as a system of linear integral equations of Volterra type. The offered model takes into account the accumulated effect of real investment and previous revenue on sales. It is supposed that the previous revenue indirectly affects the current one and reflects the influence of other factors. The accumulated impact of investment is distributed over a fix time interval. The total profit maximization problem under restrictions is stated. The existence theorem for the solutions of the total profit maximization problem is proved. The model is tested with the real data. In this case the Pontryagin’s maximum principle and numerical methods of solving the integral and differential equations are used. The results of experiment are in accordance with the understanding of optimal investment strategy. Considering it the authors state that the offered model makes a solution which is possible to increase the total profit over the planning period.