In this paper, Black Scholes’s pricing model was developed to study American option on future contracts of Brent oil. The practical tests of the model show that market priced option contracts as future contracts less than what model did, which mostly represent option contracts with price rather than without price. Moreover, it suggests call option rather than put option. Using t hypothesis test...

While pricing decisions that are based on experience are quite common, e.g., setting a selling price for a used car, this type of decision has been surprisingly overlooked in psychology and decision research. Previous studies have focused on either choice decisions from experience, or pricing decisions from description. Those studies revealed that pricing involves cognitive mechanisms other tha...

In many markets consumers incur search costs and firms choose a long-run pricing strategy that determines how they respond to market conditions. A pricing strategy may involve commitments to take actions that do not optimize short-term revenue given the information the firm learns about demand. For example, as already suggested in the literature, the firm could commit to a single price no matte...

We analyze an actuarial approach for the pricing and reserving of minimum death guarantees in unit-linked life insurance. After summarizing some results on mono-period risk measurement, we explain two possible strategies to deal with multi-period capital allocation problems. The first one uses no future information whereas the second one does. We explain how a cash-flow model can be used to per...

This paper proposes a behavioral pricing model that enhances traditional pricing algorithms by incorporating concepts from mathematical psychology and information theory on how consumers perceive discounts. We propose a framework that systematically incorporates the effect of quoted discounts and historical promotions on consumers’ valuations and helps marketers determine the optimal discount s...

a r t i c l e i n f o The Internet has provided great convenience for online shoppers and has presented unprecedented opportunities for online retailers to understand their customers. Getting the pricing right has emerged as one of the ultimate keys to the success of electronic commerce. Although some online retailers have tried some person-alized pricing strategies for perishable capacity or i...

Online information servers that provide access to diverse databases where users can search for, browse through, and download the information they need have been rapidly increasing in number in the past few years. Online vendors have traditionally charged users for information on the based on the length of the time they were connected to the databases. With hardware and software advances, many o...

In this paper, the equilibrium outcomes of the Internet quality of service (QoS) game model are analyzed when two rural Internet Access Providers (IAPs) interact with several business and technical strategies such as technology, best effort (BE) or QoS, pricing scheme (flat-rate pricing or a two-part tariff), and investment in network capacity. Considering the IAPs with BE and flat-rate pricing...

Dynamic pricing is a pricing strategy where a firm adjust the price for their products and services as a function of its perceived demand at different times. In this paper, we show how Evolutionary algorithms (EA) can be used to analyse the effect of demand uncertainty in dynamic pricing. The experiments are conducted in a range of dynamic pricing problems considering a number of different stoc...

The Internet is changing the automotive industry as the traditional manufacturer and dealer structure faces increased threats from third party e-tailers. Dynamic pricing together with the Direct-to-Customer business model can be used by manufacturers to respond to these challenges. Indeed, by coordinating production and inventory decisions with dynamic pricing, the automotive industry can incre...