Principles of Analysis of Internal Structures of Aggregate Demands

Abstract

Demand estimation problem arises each time when there is need for forecasting of the sales volume, optimal price settlement for profit maximization, or for empirical studies of the market for demand. Because there is a relationship between price and quantity demanded, it is important to understand the impact of pricing on sales by estimating the demand curve for the product. The current paper introduces new method of analysis of demand internal structure and compound nature depended on the contribution of various groups of customers. Direct and inverse problem of estimation of elementary and aggregate demands parameters are defined. Aggregate demand structure is represented as a multidimensional dummy variables regression model. The theoretical results are verified by means of corresponding numerical example.