Evaluating Time Streams of Income

Bell DE (1973). Evaluating Time Streams of Income. IIASA Research Report. IIASA, Laxenburg, Austria: RR-73-007

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Abstract

When a decision maker considers possible returns from a business project or investment, he often faces the problem that these returns are not all received at the same time, and thus he must make some adjustments to take account of his time preference for money. After a review of discounting, a utility theory approach is made by developing a two-attribute utility function u(x,t) which represents the desirability of an income of x at a time t in the future. Assumptions to simplify the assessment of this function are considered. Then u(x,t) is used to form a criterion for evaluating infinite time streams of income.

Item Type: Monograph (IIASA Research Report)
Research Programs: System and Decision Sciences - Core (SDS)
Depositing User: IIASA Import
Date Deposited: 15 Jan 2016 01:40
Last Modified: 24 Jul 2016 03:48
URI: http://pure.iiasa.ac.at/18

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