Calculation Mistake
Hi, I think there is a mistake while calculating the price elasticity for both own and cross elasticity, you choose beta 5 which is -1.09 calculated from the previous model instead of using the new one which is -0.44.
Hi Amro,
thanks for reaching out! The price elasticity used to compute the cross elasticity still uses the beta for the own brand. For further details you can consult the derivation file which you can download from this lesson:
https://learn.365datascience.com/courses/customer-analytics-in-python/segmentation-targeting-positioning/
If there's anything else unclear, do not hesitate to write to us.
Best,
365 Eli
You are right Amro, they should use -0.44 and not -1.09. -0.44 is the new 'own brand' beta, which is calculated for each segment. The instructors aren't reviewing or reading the questions correct! They've done this for other questions too! It's bad coz it changes the interpretation of the results but they are not active!