excel

Model

Pricing in a UK market
Unit cost ($)	50
Exchange rate ($/£)	1.22
Equivalent unit cost in pounds	40.984
Parameters of demand function in UK market
	Constant	Elasticity
	27556759	-2.4
Pricing model (finding the right price in £ to maximize profit in $)
Price (£) (trial value)	43.00
Demand (in UK)	3310.58
Profit ($)	8144.02
Values found from data table
Maximum profit
Best price
Data table for profit versus price
Price (£)	Profit
	8144.02
45	14545.02
46	17233.00
47	19628.60
48	21763.21
49	23664.45
50	25356.70
51	26861.54
52	28198.07
53	29383.26
54	30432.22
55	31358.39
56	32173.80
57	32889.18
58	33514.16
59	34057.36
60	34526.55
61	34928.68
62	35270.05
63	35556.32
64	35792.60
65	35983.52
66	36133.27
67	36245.62
68	36324.02
69	36371.60
70	36391.18
71	36385.34
72	36356.43
73	36306.59
74	36237.77
75	36151.74
76	36050.12
77	35934.40
78	35805.94
79	35665.96
80	35515.60
81	35355.90
82	35187.81
83	35012.19
84	34829.86
85	34641.52
86	34447.87
87	34249.51
88	34047.00
89	33840.87
90	33631.58
91	33419.58
92	33205.26
93	32989.00
94	32771.12
95	32551.94
96	32331.74
97	32110.79
98	31889.31
99	31667.53
100	31445.65

As you can see with a bit of experimenting, as the exchange rate increases (the dollar weakens), the best price in pounds decreases and the maximum profit increases. The opposite occurs when the dollar strengthens.

SolverTableSheet

1
$B$4
1
1.75
2.25
0.05
$B$13:$B$15
$A$34

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