New CDC and FDA Study Findings Have Been Reported by Investigators at Australian National University (Life-cycle Model With Subsistence Consumption Constraint and State-dependent Utilities).

A study conducted by investigators at the Australian National University explores optimal decision-making for investment, consumption, and life insurance with state-dependent utilities in continuous time. The research focuses on an economic agent with a subsistence consumption constraint and an uncertain lifetime horizon. The study utilizes the martingale approach and duality theory to analyze the stochastic optimization problem, transforming it into a dual maximization problem involving a system of linear equations. The research provides insights into optimal strategies for consumption, investment, and life insurance purchases, with case studies examining the impacts of Covid-19 and recent inflation. The study has been peer-reviewed and published in The North American Journal of Economics and Finance. [Extracted from the article]