# Approximate cost calculation

1. Jul 16, 2008

### sergey

Hello!
I have the following formula -
a*k1 + b*k2 + c*k3 = P
This is a formula i'm trying to build. It will be used to calculate price of a specific good (P) according to criterions k1,k2,k3. Every k have its own value, thats why its being multiplied by coefficients a,b and c.
I have a history of many previous purchases where k1,k2,k3 and P are known and i need to approximately calculate a,b and c according to this.

Hope i explained this well.
Can someone help me with this?

2. Jul 16, 2008

### atqamar

Just an idea:

$$P$$ is a function of $$k_1, k_2,$$ and $$k_3.$$
So the multivariable formula is in the form $$P(k_1, k_2, k_3) = ak_1 + bk_2 + ck_3$$.

If you have many values of $$P$$ and $$k$$ in the formula $$P(k) = ak$$, you would run a single variable regression on the data to find a reasonable value of $$a$$. Thus far, I am not fluent in multivariable regression, so here is a http://www.nd.com/NSBook/NEURAL%20AND%20ADAPTIVE%20SYSTEMS17_Regression_for_Multiple_Varia.html" [Broken] that might help.

Last edited by a moderator: May 3, 2017