Optimal Dynamic Investment Policies of a Value Maximizing Firm

1. Introduction.- 1.1. Scope of the Book.- 1.2. The Net Present Value in the Theory of Corporate Finance.- 1.3. Review of Dynamic Models of the Firm.- 1.4. Outline of the Book.- 2. The Net Present Value in Dynamic Models of the Firm.- 2.1. Introduction.- 2.2. The Net Present Value in a Model with the Possibility of Debt Financing.- 2.2.1. Model Formulation and Optimal Solution.- 2.2.2. The Net Present Value and Further Economic Analysis.- 2.3. The Net Present Value in a Model with Activity Analysis.- 2.3.1. Model Formulation and Optimal Solution.- 2.3.2. The Net Present Value and Further Economic Analysis.- 2.4. The Net Present Value in a Model with Corporate and Personal Taxation.- 2.4.1. Model Formulation and Optimal Solution.- 2.4.2. The Net Present Value and Further Economic Analysis.- 2.5. The Net Present Value in a Model with a Growing Economic Environment.- 2.5.1. Model Formulation and Optimal Solution.- 2.5.2. The Net Present Value and Further Economic Analysis.- 2.6. Summary.- 3. The Net Present Value in Dynamic Adjustment Cost Models of the Firm.- 3.1. Introduction.- 3.2. The Theory of Adjustment Costs.- 3.3. A Dynamic Model of the Firm with a Financial Structure and a Convex Adjustment Cost Function.- 3.3.1. Model Formulation and Solution Concept.- 3.3.2. The Net Present Value and Further Economic Analysis.- 3.4. Dynamic Firm Behavior under a Concave Adjustment Cost Function.- 3.4.1. A Standard Optimal Control Model.- 3.4.2. Model Formulation and Solution when Applying Impulse Control.- 3.5. Summary.- 4. Dynamic Firm Behavior within an Uncertain Environment.- 4.1. Introduction.- 4.2. A Stochastic Dynamic Model of a Profit Maximizing Firm.- 4.3. A Stochastic Dynamic Model under the Assumption of Risk-Averse Investor Behavior.- 4.3.1. Model Formulation and Optimal Solution.- 4.3.2. The Model Extended with the Intertemporal Capital Asset Pricing Model.- 4.4. Summary.- 5. Conclusions.- Appendix 1. Solutions of The Models of Chapter 2.- A1.1. The Model with the Possibility of Debt Financing.- A1.1.1. The Optimal Trajectories.- A1.1.2. The Net Present Value Formulas.- A1.2. The Model with Activity Analysis.- A1.2.1. The Optimal Trajectories.- A1.2.2. A Comparison with the Results of Van Loon.- A1.2.3. The Net Present Value Formulas.- A1.3. The Model with Corporate and Personal Taxation.- A1.3.1. The Optimal Trajectory.- A1.3.2. A Comparison with the Results of Van Schijndel.- A1.3.3. The Net Present Value Formulas.- A1.4. The Model with a Growing Economic Environment.- A1.4.1. The Optimal Trajectory.- A1.4.2. The Net Present Value Formulas.- Appendix 2. Solutions of the Models of Chapter 3.- A2.1. The Model with a Financial Structure and a Convex Adjustment Cost Function.- A2.1.1. The Optimal Trajectories.- A2.1.2. The Net Present Value Formulas.- A2.1.3. Extension of the Planning Period.- A2.1.4. The Case of an Infinite Time Horizon.- A2.2. The Model with a Linear Adjustment Cost Function.- A2.3. The Model with Concave Adjustment Costs and Impulse Controls.- Appendix 3. The Additional Solutions and Mathematical Proofs of Chapter 4.- A3.1. The Model of a Profit Maximizing Firm.- A3.2. The Model under the Assumption of Risk-Averse Investor Behavior.- List of Symbols.- References.