Mathematical Modeling

Total industry demand can be computed by help of the equation:

TID=164336.17-445.16*Avg. Price+0.26*Avg. Adv.

Relative demand can be computed with the following equation:

RD=16.1300-16.4445*Prel+0.7796*Arel+0.5334*RD1

Relative demand can be used to compute market share using the equation:

MS=RD/n (number of firms: n=10)

Firm Demand can be computed with the help of TID and MS and the following equation:

FD=TID*MS

The final equation for FD is the following:

FD=(164336.17-445.16*Avg. Price+0.26*Avg. Adv)*(16.1300-16.4445*Prel+0.7796*Arel+0.5334*RD1)/10