Margherita Cigola

On the comparison between the APV and the NPV computed via the WACC

The valuation of levered investment in the practice is made with the WACC approach, even if the superior technique of the APV is available. The paper shows that the APV can be interpreted as the arbitrage free value of the portfolio made by an investment and a supporting loan. Therefore the WACC evaluation, generally different from the APV, allows for arbitrage. We provide various conditions which completely characterize the sign of the error as a functions of all the variables entering the model.

On SSB Utility Theory

The SSB functional is interpreted as the difference between two probabilities. This interpretation allows one to represent preference relationships with no use of a utility function and agrees with a recent interpretation of expected utility advanced by Castagnoli and Li Calzi.

Ordinally quasiconcave functions

A traditional assumption in the definiion of generalized concave function f X→Y is that both X and Y are subsets of vector spaces. often endowed with some topology. We define and study six classes of quasiconcave functions arising when the algebric and topological structures of X and Y are replaced with partial or complete orders

A note on ordinal concavity

We introduce a new characterization of functions defined over lattices providing a necessary condition for their quasiconcavity according to the “Ordinal Concavity” approach.