Department of Defense profit policy and capital investment in the military aircraft industry

Article Abstract:

Time series analysis of data from four military aerospace contractors sheds light on the impact of two Department of Defense policies on military aircraft investments. Progress payments offered by the agency for labor and material reimbursement did not serve as an incentive for labor and material substitution for production capital. However, there exists a positive relationship between the facilities capital markup rate and capital investment. The results suggest that such policies have successfully led the defense sector in catching up with the private sector.

Aircraft, National security, Investments, Economic policy, Defense industry, United States. Department of Defense, Defense contracts

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"Swap" covered interest parity in long-date capital markets

Article Abstract:

The covered interest parity condition in long-date capital markets was evaluated using the currency swap as the forward-exchange risk hedge. Focus is on the extent to which transaction costs affect parity deviations. Net deviations were found to be neither rare nor short-lived even if transaction costs usually account for parity deviations. An analysis of the covered interest parity's variance structure shows that profit opportunities diminish and eventually disappear through time.

Research, Capital market, Capital markets, Currency swaps

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Valuing the characteristics of natural gas vehicles: an implicit markets approach

Article Abstract:

Mathematical models were constructed to evaluate consumer surplus losses stemming from government legislation requiring the substitution of gasoline cars with natural gas cars. Results indicate that costs of the natural gas cars are far greater than the immediate health benefits of such reductions. The costs of this government policy appear to match those of alternative approaches for reducing vehicular emissions.

Resources, Environment & Energy, Administration of Air and Water Resource and Solid Waste Management Programs, Laws, regulations and rules, Air pollution control, Natural resources, Environmental policy, Environmental monitoring, Air quality management

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