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Exploring financial strategies: a multiobjective visual reference point approach
Author(s) -
Costa João Paulo,
Godinho Pedro Cortesão,
Clímaco João Carlos
Publication year - 2005
Publication title -
international transactions in operational research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.032
H-Index - 52
eISSN - 1475-3995
pISSN - 0969-6016
DOI - 10.1111/j.1475-3995.2005.00518.x
Subject(s) - computer science , point (geometry) , order (exchange) , plan (archaeology) , dividend , space (punctuation) , value (mathematics) , financial plan , finance , operations research , economics , mathematics , machine learning , geometry , archaeology , history , operating system
This paper presents a multiobjective financial planning model and a technique for characterizing its solutions through the visual exploration of the reference point space. The financial planning model includes two objectives: (1) to maximize the company's value and (2) to stabilize the company's capital structure. The model also considers other planning issues like the balance of funds, the stabilization of dividend payout over the years and some limitations on debt. A technique of visual exploration of the reference point space is proposed in order to characterize the non‐dominated (efficient) model solutions. The underlying idea is not simply to choose a plan or a strategy, but to learn, explore and classify different decision strategies, gaining insight into them according to the preferred model of the decision makers.