Assignment 1: Thanks: No Later Than 04 28, on the lookout for: 00 are EST (200 points)
Be aware: The following is a regression formula. Standard errors are in parentheses intended for the demand pertaining to widgets. QD=- 5200 -- 42P & 20PX & 5. 2I +. 20A +. 25M
(2. 002)(17. 5) (6. 2) (2. 5) (0. 09) (0. 21)
R2 = 0. 55 and = 26F = 5. 88
Your supervisor provides asked you to compute the elasticities for every independent variable. Assume this values for the self-employed variables:
Q=Quantity demanded of 3-pack devices
P (in cents)=Price from the product = 500 mere cents per 3-pack unit PX (in cents)=Price of leading competitor's item = six-hundred cents per 3-pack unit I (in dollars)=Per household income with the standard metropolitan statistical region (SMSA) in which the supermarkets are located = $5, 500
A (in dollars)=Monthly advertising expenditures = $10, 000
M =Number of microwave stoves sold in the SMSA where the
supermarkets can be found = a few, 000
Set a four to six (4-6) page newspaper in which you:
1 . Compute the elasticities for each independent variable. Note: Write down all of your computations. 2 . Identify the effects for each from the computed elasticities for the business in terms of short-term and long term pricing strategies. Provide a rationale in which you refer to your results. 3. Recommend whether you think that this firm should or should not cut its cost to increase its market share. Give support to your recommendation. 5. Assume that all the factors impacting on demand in this model stay the same, yet that the selling price has changed. Additional assume that the prices are 95, 200, three hundred, 400, five-hundred, 600 mere cents. a) Storyline the demand competition for the firm.
b) Plot the corresponding supply curve on the same graph using the following MC/supply function Q = -7909. 89 + 79. 0989P with the same prices. c) Determine the equilibrium selling price and amount.
d) Outline the numerous factors that may cause within supply and demand for the item. Determine the main manner...