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How the price of a set of clubs affects the demand for clubs

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Reference no: EM131357034

Complete Problem 50 in Chapter 10 on page 477.

A golf club manufacturer is trying to determine how the price of a set of clubs affects the demand for clubs. The file P10_50.xlsx contains the price of a set of clubs and the monthly sales.

Assume the only factor influencing monthly sales is price. Fit the following three curves to these data: linear (Y = a + bX), exponential (Y = abX), and multiplicative (Y = aXb). Which equation fits the data best?

Interpret your best-fitting equation.

Using the best-fitting equation, predict sales during a month in which the price is $470.

In the discussion area, attach the Excel document showing work.

Also Please show the work in EXCEL

PLEASE USE THE REQUESTED REFERENCE.

REFERENCE

Albright, S. C, & Winston, W. L. (2017). Business Analytics: Data Analysis and Decision Making (6th ed.). Boston, MA: Cengage Learning

Chapter 10: Regression Analysis: Estimating Relationships

Chapter 11: Regression Analysis: Statistical Inference

Chapter 12: Time Series Analysis and Forecasting

Attachment:- p10-50.xlsx

Verified Expert

Here all the three specified models are fitted to the data- linear,exponential and multiplicative model. The estimates of a and b are calculated using regression function in Excel. Once the estimates of the parameters are calculated, the predicted values are also calculated for these three models. Then the residuals are measured. In regression,our aim is to fit a model which has minimum error sum of squares. Here it can be seen that for the exponential model,the residual sum of squares is significantly lower than the other two, So,it can be concluded that exponential model fits the data well.

Reference no: EM131357034

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