Under competition, the rate of return on investment tends toward equality in all industries. Introductory and intermediate microeconomics textbooks are sketchy in explaining how capital is allocated by financial markets. Capital budgeting techniques, primarily net present value, deserve a more...

“[U]nder competition, the rate of return on investment tends toward equality in all industries.” Introductory and intermediate microeconomics textbooks are sketchy in explaining how capital is allocated by financial markets. Capital budgeting techniques, primarily net present value, deserve...

We consider a multinational firm that seeks to maximize its total amount of interest tax shield while following a constant debt ratio policy on a global level. The firm's total interest tax shield can then be considered as a piecewise-linear increasing function that is concave with respect to...

This note proposes a coherent system enabling interpretation and manipulation of rates of interest (or rates of return) including an imaginary component. This may help to throw new light on equations involving complex solutions, especially when valuing investment projects. In addition, a series...