Contingent Claims Valuation of Optional Calling Plan Contracts in Telephone Industry

  • Park, Hyun-Woo (Graduate School of Management at the Korea Advanced Institute of Science and Technology) ;
  • Kim, In-Joon (Graduate School of Management at the Korea Advanced Institute of Science and Technology) ;
  • Kim, Tong-Suk (Graduate School of Management at the Korea Advanced Institute of Science and Technology)
  • Published : 1998.10.01

Abstract

This paper presents a valuation methodology for optional calling plan contracts on free-phone calls in the telephone industry. Utilization of the model is not limited to valuation and consequent decision making for the subscribers; it provides a useful guideline for telephone companies in designing calling plans and assessing subscribers' behavior.

Keywords