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Title: The construction and use of mathematical programming models for the analysis of the integrated investment and financing decision within a firm
Author: Ashton, David
ISNI:       0000 0001 3430 5329
Awarding Body: University of Warwick
Current Institution: University of Warwick
Date of Award: 1978
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This thesis examines the contribution that mathematical programming-models can make to the solution of the joint problem of investment and financing within a firm. In particular it contrasts the performance of rules for investment appraisal which are based on discounting methodologies with the solutions which are obtainable from linear programming models. Using a method of analysis which exploits the relationship between the primal and dual solutions in such models, it argues that there are strong theoretical reasons why linear programming models will not generate solutions which are radically different from those which can be arrived at by simple discounting procedures. It concludes that linear programming models in their current form add little to the practice of investment appraisal. It shows however, that such models provide a powerful framework for the development of normative decision rules for project appraisal within the broader context of the firm's operating environment. The impact of alternative measures of debt capacity and the effect of finite and irregular cash flow patterns on the investment decision are all considered using this framework. These ideas are then applied to the specific problem of the valuation of a financial lease contract. The final Chapter returns to the problem of using linear programming models for investment appraisal and explores one way in which they might be restructured to be of practical assistance to corporate financial planners.
Supervisor: Not available Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available
Keywords: HD Industries. Land use. Labor ; HG Finance