Competition
Developing an effective pricing strategy for Hoppiness also requires considering the prices for Bud. The best way to do this is by price comparisons.
Therefore, you define a new variable price.ratio
indicating the ratio of PRICE.HOP
to PRICE.BUD
. You also take the log()
to ensure that the price ratio of Hoppiness to Bud has the same magnitude as the price ratio of Bud to Hoppiness. To better understand the new price.ratio
variable, you compare its values to the original PRICE.HOP
and PRICE.BUD
values.
This exercise is part of the course
Building Response Models in R
Exercise instructions
- Calculate the ratio of
PRICE.HOP
toPRICE.BUD
. Assign the result to an object namedprice.ratio
. - Compare the
price.ratio
values to the originalPRICE.HOP
andPRICE.BUD
values by using the functionscbind()
andhead()
.
Hands-on interactive exercise
Have a go at this exercise by completing this sample code.
# Calculate the price ratio of PRICE.HOP to PRICE.BUD
price.ratio <- ___(___/___)
# Compare price.ratio to PRICE.HOP and PRICE.BUD
___(___(price.ratio, choice.data$PRICE.BUD, choice.data$PRICE.HOP))