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Question: A golf club manufacturer is trying to determine how the price of a set of clubs affects the demand for clubs. The price of a set of clubs and the monthly sales.
Price
Demand
$400
20,000
$420
19,000
$440
17,000
$460
16,000
$500
14,000
$380
22,000
$290
31,000
$340
26,000
$220
41,000
$700
6,000
1. 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?
2. Interpret your best-fitting equation.
3. Using the best-fitting equation, predict sales during a month in which the price is $470.
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