“
First Thoughts
about a business idea”
 PRICEDEMANDREVENUE
1.
Choose a single product (no services!)
2.
Choose a time period for the “accounting”
(days, weeks, months, years)
3.
Choose a market (local, state, national, global) (how many total people)
4.
Think about what % of that market might actually be interested in your product.
5.
Think about what % of those who might buy your product at some reasonable price (specify the price).
That that number and divide by the product life (how often would they repeat a purchase) use the time based
on your choice in #2.
6.
Now think about what percentage of those you might lose as customers if you raise your price by say 10%.
7.
With 5 and 6 you now have two ordered pairs for (price, quantity) so find an exponential demand model with
them.
(suggestion: exponential regression)
8.
Within what domain should you use your model?
Should you use prices near zero?
Should you allow prices
twice your reasonable price?
Specify a domain.
9.
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 Spring '10
 asd
 Derivative, Supply And Demand

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