General Cereals is using a regression model to estimate the demand for Tweetie Sweeties, a whistle-shaped, sugar-coated breakfast cereal forchildren. The following (multiplicative exponential) demand function is being used:QD -6,280 P-1.85) 42.05 №2.70whereQD quantity demanded, in 10-oz boxesP = price per box, in dollarsA = advertising expenditures on daytime television, in dollarsN = proportion of the population under 12 years old, in percentWhat is the point price elasticity of demand for Tweetie Sweeties?2.70-0.902.05-1.85What is the advertising elasticity of demand?2.700.762.05-1.85According to the estimated model, a percent increase in the proportion of the population under 12 years oldbypercent.the quantity demanded

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Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter4: Estimating Demand

Section: Chapter Questions

Problem 5E

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Please no written by hand and no emage Your company, which specializes in running shoes for men who are growing increasingly follicly-challenged (BalderDash®), has the following demand function: Q = a + bP + cM + dR where Q is the quantity demanded of BalderDash’s most popular shoes, P is the price of that product, M is consumer income, and R is the price of a related product. The regression results are: Adjusted R Square 0.7796 Independent Variables Coefficients Standard Error t Stat P-value Intercept 21,055.04 1428.27 14.74 8.1E-16 P -83.912 19.079 -4.398 0.000 M 0.0266 0.013 2.064 0.047 R -16.6 10.664 -1.556 0.129 Discuss whether you think these regression results will generate good sales estimates for BalderDash. Now assume that the income is $69,100, the price of the related good is $39, and BalderDash chooses to set the price of its product at $54. b. What is the estimated number of units sold given the data above? (round to nearest unit; no decimals) c.…
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