Abstract
In this paper, we discuss a new application of the survival functions in asset pricing from quality indexes. Thus, we propose the valuation method based on the two survival functions (VMTS) to find, under uncertainty, the market value from a quality index. Within this framework, from a one-dimensional quality index, VMTS is equivalent to the valuation method of the two distribution functions (VMTD), which produces loss with respect to the assessments from each component of a multidimensional quality index; nevertheless, VMTS provides profit with respect to these assessments from each component. Finally, we motivate the use of VMTS, as tools for the valuation of an asset, through a practical application on land pricing.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
