regression result for your product is shown in the table below:VariableParameter EstimatesStandard errorConstant-164.020.24Price of good X (P,)Price of good Y (P,)-3.501.552.500.28Per capita Income (/)0.450.52R-squaredAdjusted R-squared0.86720.8132F-statistic15.6893a) Suppose the average price of 3 units of good X is GH¢12, price of 2 units of goodY isGH¢60, the per capita income of Ghana is GH¢420.i.Write down the estimated demand equation for your firm's product and interpretthe parameter estimates.Determine the quantity of good X sold.Estimate the own price elasticity of demand and state the type of demand curve11.111.your firm has?What would be the effect of a price increase on the firm's total revenue?iv.Assess the probable impact on your firm if the firm producing geod Y decreasestheir price by 10%.Explain the adjusted R-squaredIs the good X a normal or inferior good?What is the relationship between good X and good Y?V.vi.vii.viii..

“Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

regression result for your product is shown in the table below: Variable Parameter Estimates Standard error Constant -164.0 20.24 Price of good X (P,) Price of good Y (P,) -3.50 1.55 2.50 0.28 Per capita Income () 0.45 0.52 R-squared Adjusted R-squared 0.8672 0.8132 F-statistic 15.6893 a) Suppose the average price of 3 units of good X is GH¢12, price of 2 units of goodY is GH¢60, the per capita income of Ghana is GH¢420. Write down the estimated demand equation for your firm's product and interpret 1. the parameter estimates. Determine the quantity of good X sold. Estimate the own price elasticity of demand and state the type of demand curve 11. 111. your firm has? iv. What would be the effect of a price increase on the firm's total revenue? Assess the probable impact on your firm if the firm producing good Y decreases their price by 10%. Explain the adjusted R-squared Is the good Xa normal or inferior good? V. vi. vii.

regression result for your product is shown in the table below: Variable Parameter Estimates Standard error Constant -164.0 20.24 Price of good X (P,) Price of good Y (P,) -3.50 1.55 2.50 0.28 Per capita Income () 0.45 0.52 R-squared Adjusted R-squared 0.8672 0.8132 F-statistic 15.6893 a) Suppose the average price of 3 units of good X is GH¢12, price of 2 units of goodY is GH¢60, the per capita income of Ghana is GH¢420. Write down the estimated demand equation for your firm's product and interpret 1. the parameter estimates. Determine the quantity of good X sold. Estimate the own price elasticity of demand and state the type of demand curve 11. 111. your firm has? iv. What would be the effect of a price increase on the firm's total revenue? Assess the probable impact on your firm if the firm producing good Y decreases their price by 10%. Explain the adjusted R-squared Is the good Xa normal or inferior good? V. vi. vii.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter4A: Problems In Applying The Linear Regression Model

Section: Chapter Questions

Problem 2E

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You estimated a regression with the following output. Source | SS df MS Number of obs = 163 -------------+---------------------------------- F(1, 161) = 63944.07 Model | 218107451 1 218107451 Prob > F = 0.0000 Residual | 549156.503 161 3410.90995 R-squared = 0.9975 -------------+---------------------------------- Adj R-squared = 0.9975 Total | 218656608 162 1349732.15 Root MSE = 58.403 ------------------------------------------------------------------------------ Y | Coef. Std. Err. t P>|t| [95% Conf. Interval] -------------+---------------------------------------------------------------- X | 22.59171 .0893406 252.87 0.000 22.41528 22.76814 _cons | 89.83793 8.208112 10.95 0.000 73.62848 106.0474…
DEPENDENT VARIABLE Qc R- SQUARE P- VALUE ON F 64 0.8093 0.0001 INDEPENDENTVARIABLE PARAMETER ESTIMATE STANDARD ERROR T-RATIO P-VALUE INTERCEPT 8.20 4.01 2.04 0.0461 PC -3.54 1.64 -2.16 0.0357 M 0.64287 0.19 3.38 0.0014 PA 0.7854 0.38 2.07 0.0439 10. Write the resulting regression equation. Q = f( P, M, PR) where Qc = demand for cement/month (in yards) Pc = the price of cement per yard, M = country’s tax revenues per capita, and PR = the price of asphalt per yard.
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DEPENDENT VARIABLE Qc R- SQUARE P- VALUE ON F 64 0.8093 0.0001 INDEPENDENTVARIABLE PARAMETER ESTIMATE STANDARD ERROR T-RATIO P-VALUE INTERCEPT 8.20 4.01 2.04 0.0461 PC -3.54 1.64 -2.16 0.0357 M 0.64287 0.19 3.38 0.0014 PA 0.7854 0.38 2.07 0.0439 7. If the price of asphalt (PR) decreases by 15, what will happen to the estimated quantity of cement demanded? Q = f( P, M, PR) where Qc = demand for cement/month (in yards) Pc = the price of cement per yard, M = country’s tax revenues per capita, and PR = the price of asphalt per yard.
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