Consider a soft (cola) drinks market where two firms-Firm A and Firm B-compete for market shares given by the multinomial logit (MNL) functions below: and B = Price of Firm A HA= $1.00 1 $2.00 e -0.2-PA -0.2.PA+-BPB where A and B respectively denote the market shares of Firms A and B when its corresponding products are priced at p and p; moreover, price sensitivity parameter for Firm B's customers, i.e, bB, is unknown to you-Firm A's marketing/pricing specialist. However, your past marketing/pricing data suggest that be is between 0.2 and 0.8. e a) Using the data set given in the table below, determine the value of bg. [Select] Price of Firm B --bBPA e-0.2-PA+e-BPB' $1.00 $2.00 Market Share of Firm A Market Share of Firm B 62.25% 73.11% 37.75% 26.89% Table: Market shares of Firms A and B under two different price combination b) As a newly hired marketing/pricing manager of Firm A, your goal is to increase your market share up to 80% when both firms price the product at $2.50. You decide to launch a new marketing/branding campaign to improve the product awareness and brand loyalty of your product, and thereby reduce the value of b to increase the market share (). What is the target value of b that takes your firm's market share to 80%? [Select]

Consider a soft (cola) drinks market where two firms-Firm A and Firm B-compete for market shares given by the multinomial logit (MNL) functions below: A=e0.2pA+e6BpBe0.2pAandB=e0.2pA+e6BPBebBPA. where A and B respectively denote the market shares of Firms A and B when its corresponding products are priced at pA and pA; moreover, price sensitivity parameter for Firm B's customers, i.e, bB, is unknown to you-Firm A's marketing/pricing specialist. However, your past marketing/pricing data suggest that bB is between 0.2 and 0.8 . a) Using the data set given in the table below, determine the value of bB. Table: Market shares of Firms A and B under two different price combination b) As a newly hired marketing/pricing manager of Firm A, your goal is to increase your market share up to 80% when both firms price the product at $2.50. You decide to launch a new marketing/branding campaign to improve the product awareness and brand loyalty of your product, and thereby reduce the value of bA to increase the market share (A). What is the target value of bA that takes your firm's market share to 80%