chapter  7
External Information for Pricing Decisions
WithD. C. Hague
Pages 41

In this chapter, the authors explain what information about conditions in their external environment was available to price setters in the firms. They look at the external information which should be available if price setters are to determine optimal prices for the products they sell. The authors describe an extreme and unusual situation, where a vast amount of information is available. They explore prove difficult to reach any decision at all; there would be too many possible choices and too much information about them. Since decisions always have to be taken for the future, it is clearly important to try to go beyond information about the existing market to forecast what will happen in future. Universal, Gamma and Medlock had made explicit and detailed forecasts for the future, though Gamma's forecasts turned out to be less accurate than those of any other firm.