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Titolo: Cycles optimization: The equivalent annuity and the NPV approaches
Autore: Luciano, E; Peccati, L;
 Indirizzi:
 Univ Turin, Dipartimento Stat & Matemat Applicata, I10121 Turin, Italy Univ Turin Turin Italy I10121 & Matemat Applicata, I10121 Turin, Italy
 Titolo Testata:
 INTERNATIONAL JOURNAL OF PRODUCTION ECONOMICS
fascicolo: 1,
volume: 69,
anno: 2001,
pagine: 65  83
 SICI:
 09255273(20010107)69:1<65:COTEAA>2.0.ZU;26
 Fonte:
 ISI
 Lingua:
 ENG
 Keywords:
 net present value; equivalent annuity; plant renewal;
 Tipo documento:
 Article
 Natura:
 Periodico
 Settore Disciplinare:
 Engineering, Computing & Technology
 Citazioni:
 13
 Recensione:
 Indirizzi per estratti:
 Indirizzo: Luciano, E Univ Turin, Dipartimento Stat & Matemat Applicata, Piazzza Arbarello 8, I10121 Turin, Italy Univ Turin Piazzza Arbarello 8 Turin Italy I10121 urin, Italy



 Citazione:
 E. Luciano e L. Peccati, "Cycles optimization: The equivalent annuity and the NPV approaches", INT J PRO E, 69(1), 2001, pp. 6583
Abstract
The paper discusses the use of a generalized version of the equivalent annuity principle, which takes into account interest rate fluctuations over time. When dealing with applications over a sequence of cycles, e.g. plant replacement ones, the equivalent annuity is usually defined with reference toeach single cycle or to the whole sequence. First, we study the correspondence between net present values and equivalent annuities as defined above in optimization problems. We show that only the second definition is appropriate for optimization, whenever the length of the cycle is a choice variable. However, also the second is not necessarily correct, when the horizon isfinite. Then, we discuss the corresponding problems of optimality, both with an infinite and a finite sequence of cycles. Applications to a simple plant replacement problem are illustrated: they show how different the optimal decisions can be from the equivalent annuity ones. (C) 2001 Elsevier Science B.V. All rights reserved.
ASDD Area Sistemi Dipartimentali e Documentali, Università di Bologna, Catalogo delle riviste ed altri periodici
Documento generato il 03/04/20 alle ore 11:07:20