Creditors, banks and bank regulators should evaluate whether a borrower is likely to default. I apply several techniques in the extensive mathematical literature of stochastic optimal control/dynamic programming to derive an optimal debt in an environment where there are risks on both the asset...

The problem studied in this paper consists in the fact that the social and financial risks of investments in innovations are managed in isolation, which leads to limited results (reduces certain risks but raises other risks). This paper is devoted to the search for a new strategy of managing the...

The paper presents a two-period Walrasian financial market model composed of informed and uninformed rational investors, and noise traders. The rational investors maximize second period consumption utility from the payoffs of trading risk-free holdings to risky assets in the first period. The...