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A problem that often arises in applied finance is one where decision-makers need to choose a value for some parameter that will affect the cash flows between two parties, such as a rental rate or an exercise price. Because the values of the cash flows also depend on various unobservable parameters, identifying the value of the policy parameter that achieves the desired allocation between the parties is no simple task, often resulting in disputes and the invocation of ad-hoc approaches. We showdoi:10.2139/ssrn.1266450 fatcat:n332qczp4fg7tf6zd5pjxenz2i