Risk–reward models for on-line leasing of depreciable equipment

Yong Zhang, Weiguo Zhang, Weijun Xu, Xingyu Yang
2012 Computers and Mathematics with Applications  
In this paper, we generalize the traditional on-line leasing problem to the case where the equipment is depreciable and the investor can always sell the used equipment for a positive price, which is an essential feature of many practical leasing problems. The traditional risk-reward model for the case with a certain forecast has been discussed for the on-line leasing of depreciable equipment. On the basis of this, an improved risk-reward model with a probability forecast is obtained here and
more » ... sented as the main result. A relationship between the two risk-reward models, in which the latter includes the former as a special case, is proved. Numerical analysis shows that the competitive performance is significantly improved in the risk-reward models.
doi:10.1016/j.camwa.2011.11.005 fatcat:atdpuisl4zhflcihqeyjtvvnhq