  Several problems arising in Economics and Finance are analyzed using concepts
and quantitative methods from Physics. Here is the abridged abstact:
  Chapter 1: By analogy with energy, the equilibrium probability distribution
of money must follow the exponential Boltzmann-Gibbs law characterized by an
effective temperature equal to the average amount of money per economic agent.
A thermal machine which extracts a monetary profit can be constructed between
two economic systems with different temperatures.
  Chapter 2: Using data from several sources, it is found that the distribution
of income is described for the great majority of population by an exponential
distribution, whereas the high-end tail follows a power law. The Lorenz curve
and Gini coefficient were calculated and are shown to be in good agreement with
both income and wealth data sets.
  Chapter 3: The Heston model where stock-price dynamics is governed by a
geometrical (multiplicative) Brownian motion with stochastic variance is
studied. The corresponding Fokker-Planck equation is solved exactly.
Integrating out the variance, an analytic formula for the time-dependent
probability distribution of stock price changes (returns) is found. The formula
is in excellent agreement with the Dow-Jones index for the time lags from 1 to
250 trading days.
