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Choice simulator - what would happen if I test a price beyond the price range?

Hi all,

In the choice simulator, I have set the price range between $10 - $50, and I know that you can test any price within the range.

I'm just wondering what would happen if I go beyond the price range, like if I set the price at $2, or $70. The simulator is still giving me the share of preference but can I trust these figures?

Many thanks,
Emma
asked Apr 28 by Emma Bronze (1,060 points)

1 Answer

0 votes
 
Best answer
This is called extrapolation, and as you suspect, it's iffy.  If you are using Sawtooth Software simulators, they should warn you in conditions in which you are extrapolating beyond the range included in the experiment.  The math is simple: we look at the utilities for the two most extreme price levels included in the experiment and project along that same slope into the extrapolated price range.  Since you never showed respondents prices in that extrapolated range, it's making a big assumption that the price slope will continue to be the same as the slope between the two nearest price points included in the experiment.
answered Apr 28 by Bryan Orme Platinum Sawtooth Software, Inc. (199,115 points)
selected Apr 28 by Emma
Many thanks for your answer Bryan.
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