AssetPricing: Optimal Pricing of Assets with Fixed Expiry Date
Calculates the optimal price of assets (such as
airline flight seats, hotel room bookings) whose value
becomes zero after a fixed “expiry date”. Assumes
potential customers arrive (possibly in groups) according
to a known inhomogeneous Poisson process. Also assumes a
known time-varying elasticity of demand (price sensitivity)
function. Uses elementary techniques based on ordinary
differential equations. Uses the package deSolve to effect
the solution of these differential equations.
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