Business Analytics
3rd Edition
ISBN: 9780135231678
Author: Evans, James R. (james Robert)
Publisher: PEARSON EDUCATION (COLLEGE)
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Textbook Question
Chapter 1, Problem 8PE
Four key marketing decision options are price (P), advertising (A), transportation (T), and product quality (Q). Consumer demand (D) is influenced by these variables. The simplest model for describing demand in terms of these variables is
D = k - pP + aA + tT + qQ
where k, p, a, t, and q are positive constants.
- a. How does a change in each variable affect demand?
- b. How do the variables influence each other?
- c. What limitations might this model have? Can you think of how this model might be made more realistic?
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Students have asked these similar questions
Consider a linear demand model to explain the quantity demanded for a product:
where Q = quantity sold, Price = price of the product, Income = purchaser’s income, Advert = advertising. The following data was collected in year 2018. The company spends millions of money in advertisements. The company wants to know how advertisementas well how other factors affect the quantity of units sold.
The results are as follows:
Model Summary
R
0.986
R2
0.973
Standard error of estimate
6.9872
Variables
Coefficient
Std error
Sig
Constant
205.862
19.354
0.000
Price
-12.242
1.407
0.000
Income
1.414
0.422
0.015
Advert
-3.344
1.798
0.112
Interpret and write a report based on the results obtained above.
Southerly Showtime Movie Theaters, Inc. owns and operates a chain of cinemas in several markets in the southern United States. The owners would like to estimate weekly gross revenue as a function of advertising expenditures. Data for a sample of eight markets for a recent week follow. (Let x1 represent Television Advertising ($100s), x2 represent Newspaper Advertising ($100s), and y represent Weekly Gross Revenue ($100s).)
Market
Weekly Gross Revenue ($100s)
Television Advertising ($100s)
Newspaper Advertising ($100s)
Market 1
101.3
4.9
1.4
Market 2
51.9
2.9
3.1
Market 3
74.8
3.9
1.4
Market 4
126.2
4.4
4.2
Market 5
137.8
3.7
3.9
Market 6
101.4
3.4
2.4
Market 7
237.8
5.1
8.5
Market 8
219.6
7.0
5.7
(a)
Develop an estimated linear regression equation with the amount of television advertising as the independent variable. (Round your numerical values to four decimal places.)
ŷ =
Test for a significant relationship between the amount spent on television…
The owner of the Kosher Restaurant would like to determine the fixed and variable components of the restaurant's utility expenses. The owner believes that the variable component of the utilities cost is driven by the number of meals served.
Meals Utilities served CostJanuary 3,600 P1,560February 2,000 P1,060March 2,900 P1,350April 3,500 P1,500May 3,900 P1,580June 2,100 P1,250July 1,900 P1,100August 1,000 P 850September 1,250 P 990October 1,400 P 880November 2,600 P1,180
Compute the expected utilities cost if 5,200 meals are served, using:The Lease - Squares Regression Method
Chapter 1 Solutions
Business Analytics
Ch. 1 - Explain why analytics is important in todays...Ch. 1 - Define business analytics.Ch. 1 - State three examples of how business analytics is...Ch. 1 - What are the key benefits of using business...Ch. 1 - What challenges do organizations face in using...Ch. 1 - Prob. 2.1CYUCh. 1 - How do statistical methods enhance business...Ch. 1 - What is operations research/management science?Ch. 1 - How does modern business analytics integrate...Ch. 1 - What are the components of a decision support...
Ch. 1 - Define prescriptive analytics and provide two...Ch. 1 - Define prescriptive analytics and provide two...Ch. 1 - Define prescriptive analytics and provide two...Ch. 1 - State three examples of how data are used in...Ch. 1 - How are data obtained from the Web used in...Ch. 1 - Define big data and list the four characteristics...Ch. 1 - Explain the concepts of data reliability and...Ch. 1 - Define a model and state three common forms of a...Ch. 1 - Prob. 5.2CYUCh. 1 - Prob. 5.3CYUCh. 1 - Define optimization and the characteristics of...Ch. 1 - Explain the importance of assumptions in building...Ch. 1 - What is the difference between uncertainty and...Ch. 1 - List the major phases of problem solving and...Ch. 1 - What lessons did Hewlett-Packard learn about using...Ch. 1 - For each of the following scenarios, state whether...Ch. 1 - Suppose that a manufacturer can produce a part for...Ch. 1 - Use the model developed in Example 1.5 to predict...Ch. 1 - A bank developed a model for predicting the...Ch. 1 - Four key marketing decision options are price (P),...Ch. 1 - Total marketing effort is a term used to describe...Ch. 1 - A manufacturer of headphones is preparing to set...Ch. 1 - PERFORMANCE LAWN EQUIPMENT In each chapter of this...Ch. 1 - Develop a spreadsheet for computing the demand for...Ch. 1 - The Excel file Science and Engineering Jobs shows...Ch. 1 - A new graduate has taken a job with an annual...Ch. 1 - Example 1.2 in the chapter described a scenario...Ch. 1 - Return on investment (ROI) is profit divided by...Ch. 1 - In the Accounting Professionals database, use...Ch. 1 - Prob. 7PEACh. 1 - Prob. 8PEACh. 1 - The worksheet Base Data in the Excel file Credit...Ch. 1 - The Excel file Store and Regional Sales Database...Ch. 1 - Define range names for all the data and model...Ch. 1 - Define range names for all the entities in the...Ch. 1 - Define range names for all the entities in the...
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