Purpose
This measure is used to calculate a new price required to achieve a specified target margin rate. It supports pricing decisions by showing how prices need to adjust in order to meet profitability objectives.
Business Context
In pricing and margin optimization, it is often necessary to understand how changes in margin targets impact price levels. This measure enables business users to simulate price adjustments required to move from the current margin rate to a desired target margin rate, ensuring alignment with profitability goals.
Definition
The measure calculates a new price by adjusting the current price based on the relationship between the current margin rate and the target margin rate.
Business Formula
New Price = Current Price × (1 − Current Margin Rate) ÷ (1 − Target Margin Rate)
Agent Expression
CurrentPrice * (1 - CurrentMarginRate) / NULLIF((1 - TargetMarginRate), 0)