Managerial Economics and Globalization Eco 550

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Making Decisions Based on Demand and Forecasting Week 3 Assignment Managerial Economics and Globalization ECO 550 May 9, 2013 Making Decisions Based on Demand and Forecasting Report the demographic and independent variables that are relevant to complete a demand analysis providing a rationale for the selection of the variables. As the Marketing and Public Relations Manager for my community, I am conducting research about the demographics of our community. My research will be based on demand and forecasting about the demographics of Darlington, SC. This research is the direct result of Domino Pizza’s’ interest in entering the marketplace in our community. Conducting this demand analysis and forecast for pizza will aid in the…show more content…
The structure of economics is built on the law of demand. The law of demand simply says that when the price of a good rises, the amount demanded falls, and when the price falls, the amount demanded rises. An increase in demand means that the demand curve will shift to the right. A decrease in the price of the product will not shift the demand curve, but will increase the quantity demanded (Henderson, 2008). The Coefficient of Determination Interpretation is the accuracy of the predictor of the independent variable on the dependent variable value. The coefficient of determination is calculated as the square of the correlation coefficient between the sample and predicted data. How well a regression model fits the data is shown through the coefficient of determination. The value of the coefficient of determination shows the percentage of variation that can be explained by the regression equation and is used to show how accurately a regression model can predict future outcomes (Mahvish Zehra, n.d.). The interpretation of each independent variable coefficient is as following. There is a decrease in the demand for pizza. The coefficient of the cost of pizza is, – 3,174.060 and the coefficient of the cost of soda is, -2,266.736 this shows a negative impact on demand. Although small, the coefficient of total population .579, and the average income per house

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