This paper examines the production and hedging decisions of the competitive firm under price uncertainty when the firm … difference between the actual profit and the maximum profit attained by making the optimal production and hedging decisions had … aversion, the prevalence of hedging opportunities may have perverse effect on the firm's optimal output level, particularly …

The prospect theory is one of the most popular decision-making theories. It is based on the S-shaped utility function … hedging decisions within the prospect theory. We illustrate our general considerations with a thoroughly worked out example …. -- Prospect theory ; mean-variance model ; indifference curve ; price uncertainty ; hedging …

We study the impact of transparency in a commodity market on the decision problem of a competitive firm under price … uncertainty and hedging opportunities. Market transparency is modeled by means of the informational content of publicly observable …