From the course: Data Analytics for Pricing Analysts in Excel

Unlock this course with a free trial

Join today to access over 25,300 courses taught by industry experts.

Estimating price elasticity

Estimating price elasticity - Microsoft Excel Tutorial

From the course: Data Analytics for Pricing Analysts in Excel

Start my 1-month free trial Buy for my team

Estimating price elasticity

“

- [Instructor] I'm in the 03_03_Begin Excel file. One of the first steps to optimizing price for your firm is to get an idea of what level of sales you can expect at any given price point for your product. To do that, you'll need to collect some data, of course. What I've got here in columns A and B are a series of prices for a particular product and the sales in units associated with each of these prices. So as we see in row two, a price of $100 leads to sales of 1000 units, for example. A price of 110 leads to sales of 920, et cetera. In order to figure out our price elasticity, we're going to need to go through and graph this data. To do that, I'm going to insert a scatter plot from the Insert tab, and now I'm going to add a trend line to this data. Now, if you recall, we have a couple of different types of lines that might fit with our product. In particular, we could have either a linear demand curve or a power demand…

Contents