A Model for Analysis of Bond Valuation By Using Microsoft Excel plus VBA

Thursday, October 7, 2010

Actually, what is the problem? (part2)

I think that the problem is actually to anticipate and determine the coordinates of Failure points in any projects where the failures are the function of “Time.”

Of course, it is impossible because the failure will be observed, if we are the spectator no player. In fact, actually the problem is one that is not solved by us “Now.” But we should proceed toward to solve it because of the subject mentioned in Part 1. ( In fact, the great problem is to find out which the problem must be solved so that we discover minor aims when we try to reach main aim. Just like to growth of a seed that it will be changed to a fruit but there are some minor aims during this process…………). Sometimes we are able to determine the ranges and intervals of the failures by considering of Safety Factors (FS), if we are the spectator. Please see the example as follows:

Assume that we want to solve below equation:

x^n + y^n + z^n + t^n + ……..= 0

Of course, we cannot solve above equation any time but if we make some conditions, we will be able to solve it:

Where:

- n= 2L
- “L” is a member of Natural numbers
- “x, y, z, t, …..” are the members of Real numbers

According to above conditions, we will have only one answer that is the point “O” as follows:

O (x = 0, y = 0, z = 0, t = 0 …)

Perhaps, this point could be considered as Origin of Coordinates in the world.
Analysis of above example is very important for us so that I would like to discuss about it in the future. However, I want to tell you that we will be able to solve impossible problem under some conditions.

On the other hand, I think that we have to move toward to discover the failure points.
Please see simple example below cited:

- All of systems are balancing in a level of energy
- The time of system equilibrium stability (SES) is limited to the level of energy
- The failure point, which will happen naturally or artificially (by Human), is the same the end of equilibrium time
- After the failure point, the energy will be released and the system will be balancing in a lower level of energy
- Energy Conservation Law holds true at any system (Sum E = 0)

Now, we assume the world is a system just like to Atom.
Where we have:

Spent energy by consumers included: Technology, Human, animals ….

Et = spent energy by technology
Eh = spent energy by Human, animals and etc
Er = released energy
Ep = produced energy by technology

In fact, Technology is not only the producer but also consumer.
According to Energy Conservation Law, we have:

Et + Eh + Er + Ep = 0

Since “Et” is much more than “Eh”, we analyze the options in accordance “Et” and “Ep” as follows:

There are two real options:

- Option (1): Et > Ep , The result is to be deleted the consumers ( destroy of technology, world war, epidemic disease and so on) so that the failure will be caused the system moves the lower level of energy. In this case, the new equilibrium time will be low for instance, the time between World War I and II (Refer to diagram of Crude Oil prices 2006 Dollars 1869 – 2007 by WTRG Economics & http://www.WTRG.com).

- Option (2): Ep > Et, the new equilibrium time depends on the rate of Ep / Et so that in high rate of Ep / Et, the failure will be raised sooner than option (1).

If we assume that, there is option (3) as follows:

- Mass – Energy Conservation Law holds true at any system (Sum Em + E total = 0) where we have:

- Em = Rest energy (rest mass), so that:

Et + Eh+ Er + Ep + Em = 0

This system needs to have a converter of Ep to Em and vice versa so that there will be the changing circulation of energy to mass.
Even if the option (3) will be the actual model, the start time of the converter operation depends on determining of failure point.
Therefore, above options show us that the forecast of failure points are our obligations.

For determining of failure points, we have to make the assumptions that they will be changed to the new conservation laws in the world. In fact, these new conservation laws are the supporters of new technologies that will increase the equilibrium time of the world.

Now, we proceed to make these assumptions as follows:

- Hypothesis (1):

Let me remind you about Calculus (Mathematics) at university where we used from differential equations to foresee and determine of failure points.
Why the mathematics as well as work to analyze the failure points?
I think, the most important reason is to decrease the volume of information so that we will be able to look at simultaneously the all of information written on a paper sheet with dimensions XY into an A4 paper sheet. For instance, please bear in mind the exist information on paper sheet 1*1 km2. Maybe, we will be able to write all of this information (1*1km2) on a paper sheet A4 by Mathematics.
Why do we need to decrease the size of paper sheet?
We need to glance simultaneously all of information to skim some of them or to find out logical relation among them each moment for proceeding toward solving of the problem (failure points).

Of course, Philosophy and Art also collect the huge information on A4 paper sheet similar to Mathematics but the people receive the different concepts of them (Philosophy & Art).

- What is the main axis? Mathematics, Philosophy, or Art
- Is the main axis the putting together of them?
- Is there any the main axis or we should consider a triangle of them instead of the main axis?

Now, let us assume the status as follows:

If Philosophy and Art will be the functions of independent variables where:

P = Philosophy and P = f (x1, x2, x3, x4…)

A = Art and A = f (y1, y2, y3, y4…)


A + P = Constant

It means, where the people receive a fixed and constant concepts from sum of Philosophy and Art, these concepts will be the great indicative so that Mathematics can as well as use from these concepts.
(To be continued…)

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