E1 2. Copy and paste the following data into Excel:PQ$224.009344$212.80 10034$210.56 10569$209.14 10902$206.08 11030$201.60 11167$183.68 11813$168.00 11987a. Run OLS to determine the demand function as P = f(Q); how much confidence do youhave in this estimated equation? Use algebra to invert the demand function to Q = f(P).b. Using calculus to determine dQ/dP, construct a column which calculates the point-priceelasticity for each (P,Q) combination.c. What is the point price elasticity of demand when P-$210.56? What is the point priceelasticity of demand when P=$217.00?d. To maximize total revenue, what would you recommend if the company was currentlycharging P=$183.68? If it was charging P=$217.00?e.Use your first demand function to determine an equation for TR and MR as a function ofQ, and create a graph of P and MR on the vertical and Q on the horizontal axis.f. What is the total-revenue maximizing price and quantity, and how much revenue isearned there? (Round your price to the nearest cent, your quantity to the nearest wholeunit, and your TR to the nearest dollar.) Compare that to the TR when P = $210.56 and P

Price Quantity 224.00 9344 212.80 10034 210.56 10569 209.14 10902 206.08 11030…

2. Copy and paste the following data into Excel: P $224.00 $212.80 10034 $210.56 10569 $209.14 10902 $206.08 11030 $201.60 11167 $183.68 11813 $168.00 11987 Q 9344 a. Run OLS to determine the demand function as P = f(Q); how much confidence do you have in this estimated equation? Use algebra to invert the demand function to Q = f(P). b. Using calculus to determine dQ/dP, construct a column which calculates the point-price elasticity for each (P,Q) combination. c. What is the point price elasticity of demand when P-$210.56? What is the point price elasticity of demand when P=$217.00?

2. Copy and paste the following data into Excel: P $224.00 $212.80 10034 $210.56 10569 $209.14 10902 $206.08 11030 $201.60 11167 $183.68 11813 $168.00 11987 Q 9344 a. Run OLS to determine the demand function as P = f(Q); how much confidence do you have in this estimated equation? Use algebra to invert the demand function to Q = f(P). b. Using calculus to determine dQ/dP, construct a column which calculates the point-price elasticity for each (P,Q) combination. c. What is the point price elasticity of demand when P-$210.56? What is the point price elasticity of demand when P=$217.00?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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