6. After the launch of the two models, HP tested several prices for each model in...
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6. After the launch of the two models, HP tested several prices for each model in different markets and collected the sales data from those tests. Using the data, HP estimated double-log models of demand with regression analysis. Below are the results of the regressions. In(Q30PPM) = 24.92-2.95× In (P P30PPM) +0.21× In (PColor) In(QColor) = 26.11+0.04 - In(P30PPM) - 2.80 × In (PColor) (A1) Write down HP's total variable profit function (i.e. total profits across both products in its product line), which will depend on the estimated demand functions. (A2) Using the solver tool in Excel, solve for the optimal prices for the 2 HP models that maximize HP's total variable profits. 6. After the launch of the two models, HP tested several prices for each model in different markets and collected the sales data from those tests. Using the data, HP estimated double-log models of demand with regression analysis. Below are the results of the regressions. In(Q30PPM) = 24.92-2.95× In (P P30PPM) +0.21× In (PColor) In(QColor) = 26.11+0.04 - In(P30PPM) - 2.80 × In (PColor) (A1) Write down HP's total variable profit function (i.e. total profits across both products in its product line), which will depend on the estimated demand functions. (A2) Using the solver tool in Excel, solve for the optimal prices for the 2 HP models that maximize HP's total variable profits.
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A1 HPs total variable profit function based on the estimated demand functions is P... View the full answer
Related Book For
International Marketing And Export Management
ISBN: 9781292016924
8th Edition
Authors: Gerald Albaum , Alexander Josiassen , Edwin Duerr
Posted Date:
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