Abstract
This paper examines the sale of perishable and durable goods in a general class of time-dependent dynamic pricing and advertising models. We derive general qualitative insights in the complex interplay of optimal pricing and advertising decisions. Using a path-wise argumentation we prove structural properties of the optimal expected profits with respect to time, inventory level, price impact, advertising impact and different model parameters, such as discount rate, marginal unit costs, and the holding cost rate. Moreover, we identify sufficient conditions which imply structural properties of optimal joint pricing and advertising strategies. Our analysis also implies general results for other related models, such as pure pricing and pure advertising models.
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