Four key marketing decision variables are price (P), advertising (A), transportation (T), and product quality (Q). Consumer

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Four key marketing decision variables are price (P), advertising (A), transportation (T), and product quality (Q). Consumer demand (D) is influenced by these variables. The simplest model for describing demand in terms of these variables is

D = k - pP + aA + tT + qQ

Where k, p, a, t, and q are positive constants.

a. How does a change in each variable affect demand?

b. How do the variables influence each other?

c. What limitations might this model have? Can you think of how this model might be made more realistic?

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Business Analytics Methods Models and Decisions

ISBN: 978-0321997821

2nd edition

Authors: James R. Evans

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Question Posted: Dec 09, 2015 01:51 AM

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Four key marketing decision variables are price (P), advertising (A), transportation (T), and product quality (Q). Consumer

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D k pP aA tT qQ a P As Price increases Demand goes down ...View the full answer

Business Analytics Methods Models and Decisions

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