Question: Very often, when formulating an optimization problem, it is convenient to use binary decision variables (variables that can take only the values 0 or 1).

Very often, when formulating an optimization problem, it is convenient to use binary decision variables (variables that can take only the values 0 or 1). Denote the price of a particular SKU during week t by pt. In addition, the (normalized) price of the SKU can only take of the following four values: 1 (i.e., full price), 0.9 (10% promotion), 0.8 (20% promotion) and 0.7 (30% promotion). How can one represent such a restriction using linear constraints and binary variables? (Hint: You may use more than one constraint.)

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