You are in the process of solving a basic price optimization problem to determine what price...

You are in the process of solving a basic price optimization problem to determine what price to charge for a product in order to maximize contribution. Your demand is exponential and its function is D(p) = 20000 * p^-2 and the incremental cost is $15.

A. what is your objective function?

B. you have solved a basic price optimization model and determined that your original contribution is $333.33 and you will sell to 22.22 customers. What is your optimal price?

C. You used to make a contribution of $320 and sell to 32 customers. What price did you used to charge?

D. What is your price elasticity at $25?

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Rahul Sunny answered 1 year ago

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