When you supply two datasets, demand1@price1 and demand2@price2, the program will calculate elasticity of demand (change in demand for $1 change in price) and the price which yields the maximum profit.
It also calculates discount price required to create additonal demand that will sell unused spare capacity or stock at maximum profit.
The program supplies a costing calculator for Excel. As you input these unit cost values in the pricing calculators, it will finds the exact Price which maximizes this standard profit formula:
Profit for period = Demand*Price (Revenues) - Demand*Unit Costs = Maximum value.
The program calculates the maximum price point of any product curve that produces the maximum profit.
You can use the quick Price -Max Profit Excel calculators for three price results from three different products. Use the Change demand calculator to move optimum price points up or down as demand changes.
Use the Second Pricing Strategy Excel calculator to find the discount price that will create the most profitable level of additional demand to sell spare/surplus capacity.
Use the Excel costing calculator to work out unit product costs for the pricing - profit calculators.
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