In this paper, we view an individual's annuitization decision as an American style call option whose underlying asset is financial wealth, which controls the distance to…
Abstract
In this paper, we view an individual's annuitization decision as an American style call option whose underlying asset is financial wealth, which controls the distance to annuitization. We then derive a certain threshold of wealth over which the individual is optimal to annuitize all of her wealth. We particularly focus on the effects of liquidity constraints on the individual's optimal annuitization decision, concerning their effects on the optimal investment and consumption strategies. We show that the annuitization decision can be significantly affected by the extent to which individual borrowing is constrained. More specifically, the optimal decision is for the individual to annuitize earlier with the tighter liquidity constrains she is exposed to than initially planned. This is particularly relevant to today's pandemic situation especially with the growing concern about cutting credit limits.
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Hyo-Chan Lee, Seyoung Park and Jong Mun Yoon
This study aims to generalize the following result of McDonald and Siegel (1986) on optimal investment: it is optimal for an investor to invest when project cash flows exceed a…
Abstract
This study aims to generalize the following result of McDonald and Siegel (1986) on optimal investment: it is optimal for an investor to invest when project cash flows exceed a certain threshold. This study presents other results that refine or extend this one by integrating timing flexibility and changes in cash flows with time-varying transition probabilities for regime switching. This study emphasizes that optimal thresholds are either overvalued or undervalued in the absence of time-varying transition probabilities. Accordingly, the stochastic nature of transition probabilities has important implications to the search for optimal timing of investment.
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The purpose of this paper is to examine descriptive sensory characteristics and consumer acceptability of eight commercial ready-to-eat cooked rice samples by 8 trained panelists…
Abstract
Purpose
The purpose of this paper is to examine descriptive sensory characteristics and consumer acceptability of eight commercial ready-to-eat cooked rice samples by 8 trained panelists and 50 consumers.
Design/methodology/approach
A total of 24 descriptive attributes for appearance, odor/aroma, taste/flavor, and texture were developed. Also Consumer Acceptability (CA) was performed for overall liking, appearance, flavor, and texture liking. All statistical analyses were using analysis of variance, principal component analysis (PCA), hierarchical cluster analysis (HCA), and partial least square regression (PLSR).
Findings
The overall liking score for the cooked white rice from C brand was the highest (6.43) among the eight samples. Three groups of eight commercial ready-to-eat cooked rice samples were obtained from PCA and HCA. The samples of cooked white rice from C, N, and O brand characterized by intactness, starch odor, translucency, whiteness, and glossiness were located on to the positive PLS 1, whereas the samples of cooked white rice from D and E brand characterized by scorched odor, cohesiveness, stickiness, and moistness were located on the negative side of PLS 2 in the PLSR analysis.
Originality/value
Further studies on the improvement of sensory quality for brown rice are necessary to increase CA in terms of health functionality of brown rice.