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We present analytical results related to a tool management model for a flexible machine equipped with a tool magazine, variable cutting speed, and sensors to monitor tool wear, when tool life due to flank wear is stochastic. Under some regularity conditions, we derive the special structure of decision rules for adjusting the cutting speed as a function of(More)
a r t i c l e i n f o Keywords: CAT bond valuation Catastrophic and currency exchange risk Jump-diffusion process 3D Brownian motion Importance sampling Brownian bridge In this paper, we present a new model that takes an arbitrage approach to the valuation of catastrophic risk bonds (CAT bonds). The model considers the sponsor's exposure to currency(More)