Kyung-hee Thorium Fuel (KTF), a heterogeneous thorium-based seed and blanket design concept for pressurized light water reactors, is being studied as an alternative to enhance proliferation resistance and fuel cycle economics of PWRs. The proliferation resistance characteristics of the KTF assembly design were evaluated through parametric studies using neutronic performance indices such as Bare Critical Mass (BCM), Spontaneous Neutron Source rate (SNS), Thermal Generation rate (TG), and Radio-Toxicity. Also, Fissile Economic Index (FEI), a new index for gauging fuel cycle economy, was suggested and applied to optimize the KTF design. A core loaded with optimized KTF assemblies with a seed-to-blanket ratio of 1: 1 was tested at the Korea Next Generation Reactor (KNGR), ARP-1400. Core design characteristics for cycle length, power distribution, and power peaking were evaluated by HELIOS and MASTER code systems for nine reload cycles. The core calculation results show that the KTF assembly design has nearly the same neutronic performance as those of a conventional $UO_2$ fuel assembly. However, the power peaking factor is relatively higher than that of conventional PWRs as the maximum Fq is 2.69 at the M$9^{th}$ equilibrium cycle while the design limit is 2.58. In order to assess the economic potential of a heterogeneous thorium fuel core, the front-end fuel cycle costs as well as the spent fuel disposal costs were compared with those of a reference PWR fueled with $UO_2$. In the case of comprising back-end fuel cycle cost, the fuel cycle cost of APR-1400 with a KTF assembly is 4.99 mills/KWe-yr, which is lower than that (5.23 mills/KWe-yr) of a conventional PWR. Proliferation resistance potential, BCM, SNS, and TG of a heterogeneous thorium-fueled core are much higher than those of the $UO_2$ core. The once-through fuel cycle application of heterogeneous thorium fuel assemblies demonstrated good competitiveness relative to $UO_2$ in terms of economics.