Understanding consumer demand and behavior

Assignment Help Managerial Economics
Reference no: EM13739739

Problem 1. In multiple regression analysis, explain whythe typical hypothesis that analysts want totest is whether a particular regression coefficient(B) is equal to zero (H0: B = 0) versuswhether that coefficient is not equal to zero(H1: B ≠ 0).

Problem 2. Explain what types of biases arise in the different approaches to understanding consumer demand and behavior.

Follow these instructions for completing the assignment:

1. Place all answers, both numerical and written, in a single excel spreadsheet.

2. Place each problem into a separate tab or sheet in an Excel file.

3. Place labels on spreadsheet inputs and outputs, and use the yellow highlighter on the top menu bar to highlight your final answer.

4. If the question incorporates graphs, you must replicate the graph on your spreadsheet file.

5. Do not submit Word files or multiple files for a single assignment.

Problem 3. Complete the following questions using the spreadsheet, "ECN-601 Extended Problems Data." Begin by entering the data provided on a separate Excel spreadsheet and label the tab "handout." Complete the following steps for this assignment.

1. Use regression to estimate the demand function. Show the results.

2. Write the subsequent demand equation, with Qd as the dependent variable; Price, Advertising, Product Development, and Rel Price as the independent variables.

3. How strong is the relationship between the quantity demanded and the set of independent variables? List and briefly interpret at least two measures of this strength.

4. Which variable is most important in determining quantity demanded? Justify the reasoning?

5. Solve for the price elasticity of demand. Classify the product's demand as elastic or inelastic. Price elasticity of demand can be found by the following equation:

ep = (coefficient of price variable x average price) / (average Qd)

Average values for all variables are below.



Qd

626,271





Price

$            10.06





Advertising

$        181,000





Product Development

$        125,417





Rel Price

$            10.16





6. Solve for the cross price elasticity of demand. Classify the relationship between these products as complements or substitutes. The formula for this coefficient is similar to the one for price elasticity:

7. Forecast Qd if:

Price $10.00
Advertising $150,000
Product Development $150,000
Rel Price $10.25

Construct a 95% confidence interval around this forecast.

Extended Problems Data










The following sales and marketing data was accumulated by a manufacturer over the past 12 quarters.








Qd

Price

Adv

Prod Dev

Rel Price


 561,628

 $9.75

 $150,000

 $115,000

 $9.46


 697,734

 $9.25

 $162,000

 $100,000

 $9.44


 761,217

 $9.40

 $125,000

 $125,000

 $10.14


 667,994

 $10.25

 $250,000

 $100,000

 $10.09


 496,985

 $10.40

 $200,000

 $150,000

 $10.21


 637,148

 $9.90

 $160,000

 $120,000

 $10.16


 569,773

 $10.55

 $250,000

 $100,000

 $10.34


 663,146

 $10.17

 $245,000

 $115,000

 $10.31


 432,424

 $10.30

 $185,000

 $140,000

 $10.52


 535,571

 $10.50

 $140,000

 $150,000

 $10.56


 698,376

 $10.20

 $185,000

 $140,000

 $10.38


 793,260

 $10.00

 $120,000

 $150,000

 $10.32








 Variable Definitions:





Qd = quantity demanded, in units




Price = price per unit charged by the firm that quarter



Adv = dollars spend in advertising, that quarter



 Prod Dev = dollars spent in product development that quarter.  Product development should be thought of as 



money spent on developing additional features or properties that make the product more desirable 



in the eyes of customers.




Rel Price = Price of a related product









Reference no: EM13739739

Questions Cloud

What is project oversight : Write an 350- to 700-word executive summary to your organization's leadership team covering the following:•What is project oversight?•How will project oversight impact the organization?
List several characteristics of a project : Describe in your own words what a high performing project team can do?List several characteristics of a project that can often result in creating conflict.Using an example, describe possible changes that might occur if project process is not planned.
Passengers at dubai airport have been complaining : Passengers at Dubai airport have been complaining that the security scamming process is taking too long, with wait times up to one hour being commonplace. This has led to some passengers missing their flights even though they have arrived early at th..
Strategy approaches and industry characteristics : Strategy Approaches and Industry Characteristics, The world market is made up of three (3) industries (global, international, and multidomestic). Using the two (2) dimensions (product and market requirements and operational requirements of a firm),..
Understanding consumer demand and behavior : Explain what types of biases arise in the different approaches to understanding consumer demand and behavior - explain whythe typical hypothesis that analysts want totest is whether a particular regression coefficient
What is this three-part structure of democracy : The traditional approach consists of a three-part structure or framework. What is this three-part structure of Democracy?
Put your portfolio together : Write a paper that describes how you would put your portfolio together, what support materials you are including (exact names of documents), and what the final portfolio looks like. Consider the following questions as you prepare this assignment:
Use of technology communication : Many of you have reported that is difficult to keep communication current and precise throughout the duration of her project. Also, some of you indicated that through the use of technology communication can be increased which will benefit all stak..
Employment discrimination research paper : Your project requires at least three (3) outside resources besides the textbook. Your paper must be written in APA format, include a title and reference page, and reference your sources both internally (parenthetically) and in the reference page. Ple..

Reviews

Write a Review

Managerial Economics Questions & Answers

  Linear programming problem

Linear programming is a mathematical technique used to determine the optimal solutions to certain specific problems.

  Demand, supply and the market equilibrium

The article study for the demand, supply and the market equilibrium has been discussed. The article that has been review was published on August 2012.

  Supply and demand in professional sports

Draw the individual cost curves on one graph: marginal cost, average total cost, average ?xed cost, and average variable cost. Place costs ($) on the y-axis and quantity (Q) on the x-axis.

  Explain whether the firm will make economic profit

Explain whether the firm will make economic profit, In the short run and In the long run.

  Determine the official measure of the deficit

Determine the official measure of the deficit

  Coordination of the activities of a business

The organization and coordination of the activities of a business in order to achieve defined objectives.

  What is the profit maximizing number of gizmo widgets

What is the profit maximizing number of Gizmo Widgets that should be introduced? Be sure to account for the fact that Gizmo Widgets displace other kinds of widgets. Again, be sure you provide a brief explanation of your approach/reasoning.

  Determine autocorrelation function of a rectangular pulse

Prepare the sketch the Fourier transform of a rectangular pulse of amplitude 10 V and width 0.1 second that is centered on the zero time axis. Determine the autocorrelation function of a rectangular pulse.

  Managerial economics assignment

Carry out an analysis from the standpoint of both EMV and expected utility to establish Jeremiah’s best course of action, including a consideration of his bidding strategy with regard to the auction.

  Prepare a marginal cost analysed income statement for 2014

Prepare a Marginal Cost Analysed Income Statement for 2014 from the above data to identify total and individual medical procedure contributions and profits.

  Prepare a marginal cost analysed income statement for 2014

Prepare a Marginal Cost Analysed Income Statement for 2014 from the above data to identify total and individual medical procedure contributions and profits.

  Solve managerial economics questions

MGMT 3306: Solve the assignment problems, 1. Please answer the assignment questions in this docx file and save once you’re satisfied. Assignment 3covers the lectures slides for Week 6.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd