Solution-Determined by its price-consumers income

Determined by its price-consumers income

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Reference no: EM131281204

Suppose demand for a product is determined by its price, consumers' income, and the price of a related good. Use Q for demand, P for price, M for income, and PR for price of related good. The demand function is estimated using regression analysis. The results are reported below:

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.814752135
R Square	0.663821042
Adjusted R Square	0.159552605
Standard Error	530.2842631
Observations	66
	Coefficients	Standard Error	t Stat	P-value
Intercept	125.56	15.87
P	-5.39	2.19	???
M	0.069	0.046
PR	-10.98	2.73

What is the of this regression?
What are the degrees of freedom of this regression?
What is the effect of a one-dollar increase in price (P) on demand (Q)?
What is the effect of a one-dollar increase in income (M) on demand (Q)?
What is the effect of a one-dollar increase in price of related good (PR) on demand (Q)?
Calculate the t Stat (or t ratio marked with "???" in the table) for the coefficient on P?
Test whether the effect of P on Q is significant at the 5% significance level. Show your work.
Using the p-value 0.046 in the table, test if the effect of M on Q is significant at the 5% significance level.
Using the values, ,000, and , predict the demand (Q)?
Using the value of predicted Q you just calculated for part 9), calculate the estimates of

The price elasticity of demand. Show your work.

The income elasticity of demand. Show your work.

The cross-price elasticity of demand. Show your work.

Reference no: EM131281204

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Determined by its price-consumers income

Reference no: EM131281204

Reference no: EM131281204

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