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This work is devoted to the study of the foundations of quantum K-theory, a K-theoretic version of quantum cohomology theory. In particular, it gives a deformation of the ordinary K-ring K(X) of a smooth projective variety X, analogous to the relation between quantum cohomology and ordinary cohomology. This new quantum product also gives a new class of Frobenius manifolds.

The mirror theorem is generalized to any smooth projective variety X. That is, a fundamental relation between the Gromov-Witten invariants of X and Gromov-Witten invariants of complete intersections Y in X is established.

The motivation for this paper is the study of arithmetic properties of Shimura varieties, in particular the Newton stratification of the special fiber of a suitable integral model at a prime with parahoric level structure. This is closely related to the structure of RapoportZink spaces and of affine DeligneLusztig varieties. We prove a HodgeNewton decomposition for affine DeligneLusztig varieties and for the special fibers of RapoportZink spaces, relating these spaces to analogous ones defined in terms of Levi subgroups, under a certain condition (HodgeNewton decomposability) which can be phrased in combinatorial terms. Second, we study the Shimura varieties in which every non-basic\sigma-isogeny class is HodgeNewton decomposable. We show that (assuming the axioms of He and Rapoport in Manuscr. Math. 152 (34): 317343, 2017) this condition is equivalent to nice conditions on either the basic locus or on

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