This chapter examines the interaction between supply price uncertainty and demand uncertainty. We consider a … manufacturer who sources a key component using different procurement options: a long-term order on a price-only contract, short …

. -- Background risk ; Capital structure ; Price uncertainty …This paper examines the interplay between the real and financial decisions of the competitive firm under output price … uncertainty. The firm faces additional sources of uncertainty that are aggregated into a background risk. We show that the firm …

. -- Prospect theory ; mean-variance model ; indifference curve ; price uncertainty ; hedging …. For example, the nature of monotonicity of the indifference curve depends on the underlying mean. Price hedging decisions …

theory, mean-variance model, price uncertainty …Within the prospect theory the paper examines production and hedging decisions of a competitive firm under price … uncertainty. We consider the prospect theory for the firm's utility function in the two moment model known as (mu …

trading, we present a model in which informed and uninformed traders face uncertainty about the composition of traders … (composition uncertainty). We characterize the equilibrium in both the information and financial markets. Composition uncertainty … distorts traders' information acquisition, demands, and perceived equity premium, resulting in a security price mispricing. The …

from a long-term contract supplier and a spot market under spot price uncertainty. Design/methodology/approach: This … vary with the trend of contract prices. If the contract price falls, the total quantity purchased in period 1 will decrease … in the degree of risk aversion. If the contract price increases, the total quantity purchased in period 1 will increase …