Optimal Ask (opens in new tab)

Let’s say that you are selling N widgets and you need to determine a price for your widgets. There are N customers, each of whom will buy at most one widget if your price is lower than the maximum price they are willing to pay. The maximum price that people will pay is normally distributed around $100, with a standard deviation of $5. In other words, about 34% have a max price between $95 and $100, another 34% have a max price between $100 and $105, and the rest have max prices above or below...