107k views
2 votes
When setting optimal prices, which of the following is a concern when utilizing a regression of observed sales on observed prices to set them?

a. All of these answers apply.
b. Future prices might be outside the range of past prices.
c. There is not enough variation in observed prices.

User Astm
by
5.4k points

1 Answer

3 votes

Answer:

The Future prices might be outside the range of past prices when setting optimal price

Step-by-step explanation:

Future prices might be outside the range of past prices is a concern when utilizing a regression of observed sales on observed prices to set them because setting An optimal price enables the price at which the seller can make the highest profit possible in order to increase revenue with maximum profitability in which this can only be done when using the optimal pricing strategy for example in a situation where a company is competing in several locations and different market segments, this means clearly understanding and planning a special approach for the environments before the company makes any changes in their pricing strategy is important because Future prices might be outside the range of past prices.

User Atul Verma
by
5.5k points