Optimal capital structure: a trade-off model and its empirical testing

In the present research we have set forth a new, simple, Trade-Off model that would allow us to calculate how much debt and, by default, how much equity a company should have, using easily available information and calculating the cost of debt dynamically on the basis of the effect that the capital structure of the company has on the risk of bankruptcy; in an attempt to answer this question. The proposed model has been applied to the companies that make up the Dow Jones Industrial Average (DJIA) in 2007. We have used consolidated financial data from 1996 to 2006, published by Bloomberg. We have used simplex optimization method to find the debt level that maximizes firm value. Then, we compare the estimated debt with real debt of companies using statistical nonparametric Mann-Whitney. The results indicate that 63% of companies do not show a statistically significant difference between the real and the estimated debt.

Preferred Spatial Frequencies for Human Face Processing Are Associated with Optimal Class Discrimination in the Machine

Psychophysical studies suggest that humans preferentially use a narrow band of low spatial frequencies for face recognition. Here we asked whether artificial face recognition systems have an improved recognition performance at the same spatial frequencies as humans. To this end, we estimated recognition performance over a large database of face images by computing three discriminability measures: Fisher Linear Discriminant Analysis, Non-Parametric Discriminant Analysis, and Mutual Information. In order to address frequency dependence, discriminabilities were measured as a function of (filtered) image size. All three measures revealed a maximum at the same image sizes, where the spatial frequency content corresponds to the psychophysical found frequencies. Our results therefore support the notion that the critical band of spatial frequencies for face recognition in humans and machines follows from inherent properties of face images, and that the use of these frequencies is associated with optimal face recognition performance.

Rapid optimization of drug combinations for the optimal angiostatic treatment of cancer.

Drug combinations can improve angiostatic cancer treatment efficacy and enable the reduction of side effects and drug resistance. Combining drugs is non-trivial due to the high number of possibilities. We applied a feedback system control (FSC) technique with a population-based stochastic search algorithm to navigate through the large parametric space of nine angiostatic drugs at four concentrations to identify optimal low-dose drug combinations. This implied an iterative approach of in vitro testing of endothelial cell viability and algorithm-based analysis. The optimal synergistic drug combination, containing erlotinib, BEZ-235 and RAPTA-C, was reached in a small number of iterations. Final drug combinations showed enhanced endothelial cell specificity and synergistically inhibited proliferation (p < 0.001), but not migration of endothelial cells, and forced enhanced numbers of endothelial cells to undergo apoptosis (p < 0.01). Successful translation of this drug combination was achieved in two preclinical in vivo tumor models. Tumor growth was inhibited synergistically and significantly (p < 0.05 and p < 0.01, respectively) using reduced drug doses as compared to optimal single-drug concentrations. At the applied conditions, single-drug monotherapies had no or negligible activity in these models. We suggest that FSC can be used for rapid identification of effective, reduced dose, multi-drug combinations for the treatment of cancer and other diseases.

Cost allocation of corporate IT-services

Cost allocation is an inescapable problem in nearly every organization and in nearly every facet of accounting. Within large corporations there are several different types of units, like profit-making business units and non-profit service units. In order to evaluate the performance of the business units and to fund the operations of service units, the expenses of service production need to be allocated to the business units benefiting from the services.The objective of this thesis was to find good and fair allocating factors for the costs of corporate wide IT services. In order to reach this objective, the cost allocation process was studied in general and an overview of cost structure was established. All possible cost driver candidates were mapped and their good and bad properties were weighed. The cost allocation problem was handled separately according to organizational division of corporate IT department: infrastructure, administrative systems, sales system and e-business. The emphasis was on two largest cost groups: infrastructure costs and sales system costs. As a result of the study an allocation model is presented. It contains categorization of the costs, selected cost drivers and cost distributions for the current year.

The Swiss reform of the allocation of tasks : The conventions-programs as a new partnership model for vertical cooperation ?

This research examines the impacts of the Swiss reform of the allocation of tasks which was accepted in 2004 and implemented in 2008 to "re-assign" the responsibilities between the federal government and the cantons. The public tasks were redistributed, according to the leading and fundamental principle of subsidiarity. Seven tasks came under exclusive federal responsibility; ten came under the control of the cantons; and twenty-two "common tasks" were allocated to both the Confederation and the cantons. For these common tasks it wasn't possible to separate the management and the implementation. In order to deal with nineteen of them, the reform introduced the conventions-programs (CPs), which are public law contracts signed by the Confederation with each canton. These CPs are generally valid for periods of four years (2008-11, 2012-15 and 2016-19, respectively). The third period is currently being prepared. By using the principal-agent theory I examine how contracts can improve political relations between a principal (Confederation) and an agent (canton). I also provide a first qualitative analysis by examining the impacts of these contracts on the vertical cooperation and on the implication of different actors by focusing my study on five CPs - protection of cultural heritage and conservation of historic monuments, encouragement of the integration of foreigners, economic development, protection against noise and protection of the nature and landscape - applied in five cantons, which represents twenty-five cases studies.

Capital Controls with International Reserve Accumulation: Can this Be Optimal ?

Motivated by the Chinese experience, we analyze a semi-open economy where the central bank has access to international capital markets, but the private sector has not. This enables the central bank to choose an interest rate different from the international rate. We examine the optimal policy of the central bank by modelling it as a Ramsey planner who can choose the level of domestic public debt and of international reserves. The central bank can improve savings opportunities of credit-constrained consumers modelled as in Woodford (1990). We find that in a steady state it is optimal for the central bank to replicate the open economy, i.e., to issue debt financed by the accumulation of reserves so that the domestic interest rate equals the foreign rate. When the economy is in transition, however, a rapidly growing economy has a higher welfare without capital mobility and the optimal interest rate differs from the international rate. We argue that the domestic interest rate should be temporarily above the international rate. We also find that capital controls can still help reach the first best when the planner has more fiscal instruments.

A Reappraisal of the Allocation Puzzle through the Portfolio Approach

Paradoxically, high-growth, high-investment developing countries tend to experience capital outflows. This paper shows that this allocation puzzle can be explained simply by introducing uninsurable idiosyncratic investment risk in the neoclassical growth model with international trade in bonds, and by taking into account not only TFP catch-up, but also the capital wedge, that is, the distortions on the return to capital. The model fits the two following facts, documented on a sample of 67 countries between 1980 and 2003: (i) TFP growth is positively correlated with capital outflows in a sample including creditor countries; (ii) the long-run level of capital per efficient unit of labor is positively correlated with capital outflows. Consistently, we show that the capital flows predicted by the model are positively correlated with the actual ones in this sample once the capital wedge is accounted for. The fact that Asia dominates global imbalances can be explained by its relatively low capital wedge.

Gene filtering with optimal threshold selection

Gene filtering is a useful preprocessing technique often applied to microarray datasets. However, it is no common practice because clear guidelines are lacking and it bears the risk of excluding some potentially relevant genes. In this work, we propose to model microarray data as a mixture of two Gaussian distributions that will allow us to obtain an optimal filter threshold in terms of the gene expression level.

Optimal Exchange Rate Policy in a Growing Semi-Open Economy

This paper considers an alternative perspective to China's exchange rate policy. It studies a semi-open economy where the private sector has no access to international capital markets but the central bank has full access. Moreover, it assumes limited financial development generating a large demand for saving instruments by the private sector. The paper analyzes the optimal exchange rate policy by modeling the central bank as a Ramsey planner. Its main result is that in a growth acceleration episode it is optimal to have an initial real depreciation of the currency combined with an accumulation of reserves, which is consistent with the Chinese experience. This depreciation is followed by an appreciation in the long run. The paper also shows that the optimal exchange rate path is close to the one that would result in an economy with full capital mobility and no central bank intervention.

One-seller assignment markets with multi-unit demands

We consider one-seller assignment markets with multi-unit demands and prove that the associated game is buyers-submodular. Therefore the core is non-empty and it has a lattice structure which contains the allocation where every buyer receives his marginal contribution. We prove that in this kind of market, every pairwise-stable outcome is associated to a competitive equilibrium and viceversa. We study conditions under which the buyers-optimal and the seller-optimal core allocations are competitive equilibrium payoff vectors. Moreover, we characterize the markets for which the core coincidences with the set of competitive equilibria payoff vectors. When agents behave strategically, we introduce a procedure that implements the buyers-optimal core allocation as the unique subgame perfect Nash equilibrium outcome.

Identifying Individual T Cell Receptors of Optimal Avidity for Tumor Antigens.

Cytotoxic T cells recognize, via their T cell receptors (TCRs), small antigenic peptides presented by the major histocompatibility complex (pMHC) on the surface of professional antigen-presenting cells and infected or malignant cells. The efficiency of T cell triggering critically depends on TCR binding to cognate pMHC, i.e., the TCR-pMHC structural avidity. The binding and kinetic attributes of this interaction are key parameters for protective T cell-mediated immunity, with stronger TCR-pMHC interactions conferring superior T cell activation and responsiveness than weaker ones. However, high-avidity TCRs are not always available, particularly among self/tumor antigen-specific T cells, most of which are eliminated by central and peripheral deletion mechanisms. Consequently, systematic assessment of T cell avidity can greatly help distinguishing protective from non-protective T cells. Here, we review novel strategies to assess TCR-pMHC interaction kinetics, enabling the identification of the functionally most-relevant T cells. We also discuss the significance of these technologies in determining which cells within a naturally occurring polyclonal tumor-specific T cell response would offer the best clinical benefit for use in adoptive therapies, with or without T cell engineering.

Graduating 4th year radiology residents' perception of optimal imaging modalities for neoplasm and trauma: a pilot study from four U.S. universities

OBJECTIVE: Our purpose was to assess 4th year radiology residents' perception of the optimal imaging modality to investigate neoplasm and trauma. MATERIALS AND METHODS: Twenty-seven 4th year radiology residents from four residency programs were surveyed. They were asked about the best imaging modality to evaluate the brain and spine, lungs, abdomen, and the musculoskeletal system. Imaging modalities available were MRI, CT, ultrasound, PET, and X-ray. All findings were compared to the ACR appropriateness criteria. RESULTS: MRI was chosen as the best imaging modality to evaluate brain, spine, abdominal, and musculoskeletal neoplasm in 96.3%, 100%, 70.4%, and 63% of residents, respectively. CT was chosen by 88.9% to evaluate neoplasm of the lung. Optimal imaging modality to evaluate trauma was CT for brain injuries (100%), spine (92.6%), lung (96.3%), abdomen (92.6%), and major musculoskeletal trauma (74.1%); MRI was chosen for sports injury (96.3%). There was agreement with ACR appropriateness criteria. CONCLUSION: Residents' perception of the best imaging modalities for neoplasm and trauma concurred with the appropriateness criteria by the ACR.

Life span and reproductive cost explain interspecific variation in the optimal onset of reproduction.

Fitness can be profoundly influenced by the age at first reproduction (AFR), but to date the AFR-fitness relationship only has been investigated intraspecifically. Here, we investigated the relationship between AFR and average lifetime reproductive success (LRS) across 34 bird species. We assessed differences in the deviation of the Optimal AFR (i.e., the species-specific AFR associated with the highest LRS) from the age at sexual maturity, considering potential effects of life history as well as social and ecological factors. Most individuals adopted the species-specific Optimal AFR and both the mean and Optimal AFR of species correlated positively with life span. Interspecific deviations of the Optimal AFR were associated with indices reflecting a change in LRS or survival as a function of AFR: a delayed AFR was beneficial in species where early AFR was associated with a decrease in subsequent survival or reproductive output. Overall, our results suggest that a delayed onset of reproduction beyond maturity is an optimal strategy explained by a long life span and costs of early reproduction. By providing the first empirical confirmations of key predictions of life-history theory across species, this study contributes to a better understanding of life-history evolution.