Expected utility of net present value is the practitioner's approach to incorporate risk aversion into the evaluation of a project's cash flows. The discount rate and the convergence with the risk-neutral beta-adjusted approach from finance have always been a question. To fill this gap, we adopt...

The classic sequential search problem rewards the decision-maker with the highest sampled value, minus the sampling cost. If the sampling distribution is unknown, then a Bayesian decision-maker faces a complex balance between learning and optionality. We solve the stopping problem of sampling...

Trend indicators aim to visualize the effect of input assumptions and parameters into model output. Their use is increasingly important, especially when the output is generated by a black box algorithm. We investigate the properties of several trend indicators used in simulation and machine...

We introduce range utility theory for decisions under risk. Two functions are implicated in the representation of preferences: a traditional utility function for wealth---or changes in wealth---and a range distortion function. The latter introduces a local deformation of the utility function on...

Rank dependent probability weighting---an integral part of cumulative prospect theory---has come to dominate the behavioral modeling of risk preferences in non-strategic settings over the last 40 years. We draw attention to some serious limitations of rank dependence when it comes to...