This research investigates how the price frame affects the consumer’s preference. Using qualitative methodology from the prospective of behavioral science, we find in the overall assessment of a product, the consumers have more selective attention and thus higher weight on secondary attributes under partitioned pricing than under combined pricing. That means in online selling, consumers pay mor...

The aim of this paper is to study the problem of optimality of replicating strategies associated with pricing of American contingent claims in the Cox–Ross–Rubinstein model with proportional transaction costs. We show that a replication of the option is always possible. We give sufficient conditions for the existence of a replicating strategy which is optimal, and also show an example of an opt...

Research ...nds that ...rms’ investment decisions are distorted by irreversibility and ...nance constraints. Whereas the existing literature examines the e¤ects of these features separately, this paper studies their interaction. The impact of these constraints on a ...rm’s incentive to invest is characterised using option pricing techniques. Financial constraints reduce the initial capacity, ra...

Recently, investors have paid great attention to the metaverse sector and investing instruments for metaverse. Metaverse has become most popular investment since 2021. Due rapid development of industry, coupled with social instability, it is critical search appropriate investment. Previous literature proposed many advantages rainbow options expected growth industry. However, there currently a l...

We study Dupire’s equation for local volatility models with bubbles. The equation for call options contains extra terms compared to the usual equation, whereas, surprisingly enough, the Dupire equation for put options does not contain any extra terms. We also note that uniqueness of solutions to the Dupire equation is lost in general, and we show how to single out the option price among all pos...

This paper describes the Itô processes for the continuously compounded returns on European call and put stock options under the one-dimensional diffusion assumption and the Black Scholes pricing model. It uses the Itô processes to motivate discrete time approximations for the returns on calls and puts. Theses models are used in a simulation study to compute the probability of an option return v...

This is the second part of our survey on exponential functionals of Brownian motion. We focus on the applications of the results about the distributions of the exponential functionals, which have been discussed in the first part. Pricing formula for call options for the Asian options, explicit expressions for the heat kernels on hyperbolic spaces, diffusion processes in random environments and ...