# BUS 446 Week 4 Assignment

**Topics:**Regression analysis, Microwave oven, Per capita income

**Pages:**4 (632 words)

**Published:**November 2, 2014

This file includes BUS 446 Week 4 Assignment Just-In-Time Deadline: ( ), Business - Management

Assignment 1: Demand Estimation

Due Week 3 and worth 200 points

Imagine that you work for the maker of a leading brand of low-calorie, frozen microwavable food that estimates the following demand equation for its product using data from 26 supermarkets around the country for the month of April.

For a refresher on independent and dependent variables, please go to Sophia’s Website and review the Independent and Dependent Variables tutorial, located at http://www.sophia.org/tutorials/independent-and-dependent-variables--3.

Option 1

Note: The following is a regression equation. Standard errors are in parentheses for the demand for widgets. QD = - 5200 - 42P + 20PX + 5.2I + .20A + .25M

(2.002) (17.5) (6.2) (2.5) (0.09) (0.21)

Your supervisor has asked you to compute the elasticities for each independent variable. Assume the following values for the independent variables:

Q = Quantity demanded of 3-pack units

P (in cents) = Price of the cents per 3-pack unit

PX (in cents) = Price of leading competitor’s cents per 3-pack unit I (in dollars) = Per capita income of the standard metropolitan statistical area (SMSA) in which the supermarkets are located = $5,500

A (in dollars) = Monthly advertising expenditures = $10,000 M = Number of microwave ovens sold in the SMSA in which the supermarkets are ,000

Option 2

Note: The following is a regression equation. Standard errors are in parentheses for the demand for widgets.

QD = -2,000 - 100P + 15A + 25PX + 10I

(5,234) (2.29) (525) (1.75) (1.5)

Your supervisor has asked you to compute the elasticities for each independent variable. Assume the following values for the independent variables:

Q = Quantity demanded ...

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