Firms often search enthusiastically for distinguishing traits that they may use to price discriminate between segments. Yet there are occasions in which firms forgo the opportunity to price discriminate and instead charge a single price. Traditional explanations for why retailers forgo the opportunity to price discriminate focus on the cost of discriminating, including operational costs, explic...

An installment option is a European option in which the premium, instead of being paid up-front, is paid in a series of installments. If all installments are paid the holder receives the exercise value, but the holder has the right to terminate payments on any payment date, in which case the option lapses with no further payments on either side. We discuss pricing and risk management for these ...

Installment options are path-dependent contingent claims in which the premium is paid discretely or continuously in installments, instead of paying a lump sum at the time of purchase. This paper deals with valuing European continuous-installment options written on dividend-paying assets in the standard Black-Scholes-Merton framework. The valuation of installment options can be formulated as a f...

We analyze a new data set on installment borrowing decisions of a sample of customers of a credit card company. In an attempt to increase its market share, the company more or less randomly offers its customers free installments, i.e. opportunities to finance credit card purchases via installment loans at a zero percent interest rate for durations up to twelve months. We exploit these offers as...

This paper evaluates the deposit and purchase pricing of contracts in a risk-neutral framework. First, we determine fair price single-installment contract based on theoretical modeling numerical analysis. Second, buyer’s threshold dual-installment multi-installment is investigated under framework compound options. Lastly, behavior deposits purchases further analyzed using simultaneous equations

Installment options are weakly path-dependent contingent claims in which the premium is paid discretely or continuously in installments, instead of paying a lump sum at the time of purchase. This paper deals with valuing American continuousinstallment options written on dividend-paying assets. The setup is a standard Black-Scholes-Merton framework where the price of the underlying asset evolves...

The 125th anniversary of the birth of Srinivasa Ramanujan was on December 22, 2012. To mark the occasion, the Notices is publishing a feature article of which this is the second and final installment. This installment contains pieces by Ken Ono, Kannan Soundararajan, Robert Vaughan, and Ole Warnaar on various aspects of Ramanujan’s work. The first installment appeared in the December 2012 issue...