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Looking at the logit price-response function taken from here.

enter image description here

I take it that the output would be a probability, if C = 1?

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1 Answer 1

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In the document you mentionned, you can read that :

Recall, d(p) is the number of customers willing to pay at least p for the product

So it should not be a probabilty ..

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  • $\begingroup$ so maybe I could use the standard logistic function as in logistic regression? $\endgroup$
    – cs0815
    Commented Mar 10, 2022 at 12:18
  • $\begingroup$ What do you mean ? $\endgroup$ Commented Mar 10, 2022 at 15:30
  • $\begingroup$ basically I want it to be a probability ... x axis corresponds to the price and y to the probability (probability = 1 at price 0) $\endgroup$
    – cs0815
    Commented Mar 10, 2022 at 15:33
  • $\begingroup$ I'm not sure to understand you .. what do you call a probability ? $\endgroup$ Commented Mar 10, 2022 at 15:37
  • $\begingroup$ a value between 0 and 1 indicating purchase probability given price??? $\endgroup$
    – cs0815
    Commented Mar 10, 2022 at 15:40

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