Suppose your estimated equation for Soft Drink Demand is Cans = a + B1*Price + B2*Income + B3*Temp + B4*Outdoor = 400 - 150*Price + 3*Income + 1*Temp + 40*Outdoor. Nowsuppose Price = 2.08, Income = 17, Temp = 69 and the state is an "Outdoor" state. Use the demand function I just provided to find the point Price Elasticity of demand. [Side Note: youare finding the point price elasticity of soft drink demand for Texas.]O A. .68.O B. -1.26.OC.-1.63.O D. -2.64.O E. None of the above.QUESTION 18Next, estimate the multiplicative or log linear equation (2) InCans = Ina + B1*InPrice + B2*Inlncome + B3*InTemp + B4*Outdoor. You will need to convert Cans, Price, Income andTemp into natural log variables to estimate this equation. Outdoor is still a 0 -1 dummy variable, where an outdoor state is assigned a value of 1.0. Do not try to take the log of theOutdoor dummy variable. What percentage of the variation in demand for cans is explained by this model?O A. 89.O B..74.OC..61.O D. 55.QUESTION 19Refer to your output for Equation (2b) InCans = Ina + B1*InPrice + B2*Inincome + B3*InTemp + B4*South. What is the estimated price elasticity of demand?O A. -88.O B. -1.25.OC.-1.88.O D.-2.34.O E. -3.01.

Since you have asked multiple question, we will solve the first question for you. If youwant any…

Suppose your estimated equation for Soft Drink Demand is Ca suppose Price = 2.08, Income = 17, Temp = 69 and the state is an "Outdoor" state. Use the demand function i just provided to find the point Price Elasticity of demand. [Side Note: you are finding the point price elasticity of soft drink demand for Texas.) O A. .,68. О В.-1.26. a+ B1*Price + B2*Income + B3*Temp + B4*Outdoor Price + 3*Income + 1*Temp + 40*Outdoor. Now OC.-1.63. O D.-2.64. O E. None of the above. QUESTION 18 Next, estimate the multiplicative or log linear equation (2) InCans =- Ina + B1*InPrice + B2*Inlncome + B3*InTemp + p4*Outdoor. You will need to convert Cans, Price, Income and Temp into natural log variables to estimate this equation. Outdoor is still a 0 -1 dummy variable, where an outdoor state is assigned a value of 1.0. Do not try to take the log of the Outdoor dummy variable. What percentage of the variation in demand for cans is explained by this model? O A. 89. O B. .74. OC.61. O D. 55. QUESTION 19 Refer to your output for Equation (2b) InCans = Ina + B1*InPrice + B2*Inincome + B3*InTemp + B4*South. What is the estimated price elasticity of demand? O A. 88. O B. -1.25. OC.-1.88. O D.-2.34. O E. -3,01.

Suppose your estimated equation for Soft Drink Demand is Ca suppose Price = 2.08, Income = 17, Temp = 69 and the state is an "Outdoor" state. Use the demand function i just provided to find the point Price Elasticity of demand. [Side Note: you are finding the point price elasticity of soft drink demand for Texas.) O A. .,68. О В.-1.26. a+ B1Price + B2Income + B3Temp + B4Outdoor Price + 3Income + 1Temp + 40Outdoor. Now OC.-1.63. O D.-2.64. O E. None of the above. QUESTION 18 Next, estimate the multiplicative or log linear equation (2) InCans =- Ina + B1InPrice + B2Inlncome + B3InTemp + p4Outdoor. You will need to convert Cans, Price, Income and Temp into natural log variables to estimate this equation. Outdoor is still a 0 -1 dummy variable, where an outdoor state is assigned a value of 1.0. Do not try to take the log of the Outdoor dummy variable. What percentage of the variation in demand for cans is explained by this model? O A. 89. O B. .74. OC.61. O D. 55. QUESTION 19 Refer to your output for Equation (2b) InCans = Ina + B1InPrice + B2Inincome + B3InTemp + B4*South. What is the estimated price elasticity of demand? O A. 88. O B. -1.25. OC.-1.88. O D.-2.34. O E. -3,01.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: QUESTION 3 What will happen to the price elasticity of demand for Ford sport-utility vehicles (SUVS)…

A: Elasticity of demand measures the responsiveness of percentage change in quantity demanded due to…

Q: O pts.) a. Define price elasticity of demand. b. At a price of $7, the quantity demanded for ice…

A: Elasticity of demand is the percentage change in quantity demanded due to percentage change in…

Q: 2. Consider the following demand schedule for widgets: Price ($ per widget) Quantity (# per month)…

A: Price elasticity of demand is a measurement of the change in consumption of a product in relation to…

Q: 17. Problems and Applications Q3 Suppose the price elasticity of demand for heating oil is 0.1 in…

A: Price elasticity of demand: It measures the percentage change in the quantity demanded for a 1%…

Q: Price P1 5% 5% O a Greater than 1 O b. Equal to zerd Oc. Infinite O d. Equal to 1 Q2 Quantity…

A: Elasticities influence fiscal and monetary policies as well, assisting policymakers to more…

Q: (Categories of Price Elasticity of Demand) For each of thefollowing absolute values of price…

A: In economics, price elasticity of demand is a metric. It is used to determine how sensitive an item…

Q: 2. The Demand Elasticity at the (11,000, $300) point is equal to Elasticity of Demand formula) and…

A: The demand curve represents the quantity demanded by consumers at different price levels. The price…

Q: Pop's Com Popcorn shop normally sells 100 bags a day when the price is S6 per bag. On half-price…

A: Given: The quantity one for bags per day is = 100 bags The price is = $6 per bag The price now…

Q: elasticity of demand

A: Price elasticity of demand is a measure that quantifies the responsiveness of the quantity demanded…

Q: If a 10% increase in the price of pens causes the quantity demanded to decrease from 800 boxes to…

A: Elasticity of demand measures the magnitude of change in the quantity of a good demanded due to rise…

Q: Question 2 The price elasticity of demand for heroin is: O Less than 1. O Between 0 and 1.5. O Is…

A: When the price of a product is elastic, a change in the amount requested changes fast. When the…

Q: The price of milk at the local grocery store is cut by 10%. The quantity of milk demanded increases…

A: Absolute of of price elasticity of demanded show below

Q: An end-of-aisle price promotion changes the price elasticity of a good from -4 to -5. Suppose the…

A: Introduction Elasticity is a term used in economics to indicate how responsive one variable is to…

Q: 140--+ 70 50-- 20 Demand 20 28 56 QUANTITY (Units) For each of the regions listed in the following…

A: Price elasticity of demand measures the responsiveness of quantity demanded to a change in the…

Q: nt in the price of cars results in an increase of 30 percent in quantity dem

A: The amount of goods and services that are required by the people in the society is called quantity…

Q: For the demand function q = D(p) = a) Find the equation for elasticity. 100 (p+ 9) 5 a) The…

A: The elasticity of demand is a measure used in economics to quantify the responsiveness of the…

Q: The aggregate demand for the mushroom pasta for each day is given by q = 200 - 4p, where p is the…

A: Given, q = 200 - 4p Price, p = $20 Q = 200 - 4p Putting P = $20 We get, Q = 200 - 4*20 Q = 200 -…

Q: None

A: Solution:CASE : 1 Income : $20,000Price (P1) = $ 14Quantity (Q1)= $16Price (P2) = $ = 8 Calculate…

Q: You are the manager of a firm that receives revenues of $60,000 per year from product X and $80,000…

A: please find the answer below.

Q: A pizza restaurant raises the price of their pizza by 20%. As a result, they witness a 10% decrease…

A: Price elasticity of demand: It refers to the change in the price of goods and services which in…

Q: If an increase in price from $1 to $2 causes a decrease in quantity demanded from 120 to 100,…

A: Elasticity is used to calculate the relative change in the quantity demanded of the good as compared…

Q: Table 1B: Price Quantity Before: $5.00 30 After: $4.00 40 Refer to Table 1B. Price Elasticity of…

A: Price elasticity of demand refers change in demand due to change in price so here we calculate the…

Q: 1) Know: What is meant by Price Elasticity of > Additionally, explain demand Elastic, Unitary, and…

A: "Since you have asked multiple questions, we will answer only first question for you. If you have…

Q: Price $7 6. 4. 3 1 4 10 12 14 Quantity What is the price elasticity of demand when the price is $2?…

A: Price elasticity of demand = %Change in Quantity / %Change in Price %Change in Quantity = (Q2 -…

Q: - Given the demand function D(p) = √√/375 – 4p, Find the Elasticity of Demand at a price of $22 At…

A: Since the elasticity of demand is greater than one, this means the demand is elastic at a price…

Question

Suppose your estimated equation for Soft Drink Demand is Cans = a + B1*Price + B2*Income + B3*Temp + B4*Outdoor = 400 - 150*Price + 3*Income + 1*Temp + 40*Outdoor. Now
suppose Price = 2.08, Income = 17, Temp = 69 and the state is an "Outdoor" state. Use the demand function I just provided to find the point Price Elasticity of demand. [Side Note: you
are finding the point price elasticity of soft drink demand for Texas.]
O A. .68.
O B. -1.26.
OC.-1.63.
O D. -2.64.
O E. None of the above.
QUESTION 18
Next, estimate the multiplicative or log linear equation (2) InCans = Ina + B1*InPrice + B2*Inlncome + B3*InTemp + B4*Outdoor. You will need to convert Cans, Price, Income and
Temp into natural log variables to estimate this equation. Outdoor is still a 0 -1 dummy variable, where an outdoor state is assigned a value of 1.0. Do not try to take the log of the
Outdoor dummy variable. What percentage of the variation in demand for cans is explained by this model?
O A. 89.
O B..74.
OC..61.
O D. 55.
QUESTION 19
Refer to your output for Equation (2b) InCans = Ina + B1*InPrice + B2*Inincome + B3*InTemp + B4*South. What is the estimated price elasticity of demand?
O A. -88.
O B. -1.25.
OC.-1.88.
O D.-2.34.
O E. -3.01.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

16.) Suppose that a demand curve passes through the points (4,$4.00) and (8,$2.00). What is the price elasticity of demand measured between these two points? а.) -1 b.) 1 c.) -2 d.) 2 17.) Which of the following goods would you expect to have the highest price elasticity of demand? a.) Diamonds b.) Pretzels c.) Rice d.) Tap water
Consider the market for chocolate chip cookies where the supply is very price elastic which means that Oa 10% percentage increase in price would lead to a greater percentage increase in quantity supplied Oa 15% decrease in price would lead to a smaller percentage increase in quantity supplied Oa 20% increase in price would lead to a smaller percentage decrease in quantity supplied of chocolate chip cookies Oa 15% decrease in price would lead to no percentage change in quantity supplied In the event of a decrease in demand, what is the likely change in market equilibrium? Oa large decrease in price and in quantity Oa large decrease in price and small decrease in quantity Oa small decrease in price and large decrease in quantity Oa small decrease in price and quantity
When the price of a given type of hamster chow increased by 22%, 22% more units were produced and sold. Calculate the appropriate elasticity. Use this answer to interpret the question in the picture.
For a certain good, when price rises from $100 to $150, quantity demanded falls from 2,000 to 1,200. The price elasticity of demand here is making the demand for this good in the price range between $100 and $150. 0.8; inelastic O 0.67; inelastic 0.15; inelastic 1.50; elastic O 1.25; elastic
Table 1B: Price Quantity Before: $5.00 30 After: $4.00 40 Refer to Table 1B. Price Elasticity of Demand is about O 1.657 O No answer text provided. O 1.667 O No answer text provided.
2
Suppose that the elasticity of supply is 1.60 and the price increases by 5%. We will predict a percent increase in the quantity supplied of: 8% 6% O 3.1% 12%
5) Calculate the arc price elasticity of demand for wheat in the two situations below: Farmer Brown's Wheat Old price; $3.40/bu Old quantity; 28,000 bu The Wheat Market Old price; $3.40/bu Old quantity; 2.5 billion bu New price; $3.20/bu New price; $3.20/bu New quantity; 2.525 billion bu New quantity; 35,000 bu Can you account for the difference in elasticities?
20 Given the demand equation x = 4 + where p represents the price in dollars and x the number of units, determine the elasticity of demand when the price p is equal to $5. Р Elasticity of Demand = Therefore, demand is O elastic O unitary O inelastic when price is equal to $5 and a small increase in price will result in O a decrease in total revenue. O little to no change in total revenue. O an increase in total revenue.
If the price elasticity of demand for coffee is -0.5 and Starbuck's is expecting a 10% increase in price, then what will be the new quantity demanded if it's currently 100 cups/hour. 95 cups/hour O 105 cups/hour 80 cups/hour O 120 cups/hour
11
Suppose a firm faces an elasticity of demand of -1 at its current price/quantity levels. This firm would maximize its revenue by: O Maintaining current prices. O Decreasing Prices O Increasing Prices