Memoirs of the Faculty of Engineering, Okayama University
Published by Faculty of Enginerring, Okayama University

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Memoirs of the School of Engineering, Okayama University

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Price Determination Method Based on Price Elasticity

Li Zhenzi
Osaki, Hirokazu
Kajihara, Yasuhiro
Abstract
In this paper, we propose the price determination method using the parameter of the price elasticity that shows the relation between price and demand. Firstly, the state of the price elasticity is examined under the condition that the relation between price and demand are assumed by the inverse proportional function, the linear function and the quadratic function. Secondly, the profit is estimated for each product by break even point analysis. And the price is determined under the condition that the relation between the demand and price is shown by one of three demand-pridce functions above mentioned.
ISSN
0475-0071
NCID
AA10699856