Neoclassical financial models provide the foundation for our understanding of finance. This chapter introduces the main ideas of neoclassical finance in a single-period context that avoids the technical difficulties of continuous-time models, but preserves the principal intuitions of the...

University donors can contribute to endowment to make a permanent impact, given that universities are committed to investment and spending policies that preserve capital. Unfortunately, practitioner's common criterion of spending less than the expected return on endowment is known not to be...

As in continuous time, the nontrading region (NTR) in a mean-variance model with fixed, proportional, and quadratic trading costs is a singleton only for pure quadratic costs. Utility loss from costs is approximately proportional at small cost levels, and approximately constant at large cost...