ABC Corporation has used regression analysis to perform price elasticity analysis.

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Question 1:
ABC Corporation has used regression analysis to perform price elasticity analysis. In doing so management regressed the quantity demanded (y variable) against price (x variable) with the following results:
Multiple R .86798 
Adjusted R squared .72458, 
Standard error 542.33
Intercept 56400.50
Price coefficient –4598.20

What percentage of the variation in quantity demanded is explained by price?
A) 86.798%
B) 72.45%
C) 56.4%
D) 54.23%

Question 2:
ABC Corporation has used regression analysis to perform price elasticity analysis. In doing so management regressed the quantity demanded (y variable) against price (x variable) with the following results:
Multiple R .86798
Adjusted R squared .72458, 
Standard error 542.33
Intercept 56400.50
Price coefficient –4598.20

Calculate the predicted quantity demanded if price is set at $ 7.00. 
A) 31,234
B) 88,588
C) 24,213
D) 18,454 

  • 5 years ago
ABC Corporation has used regression analysis to perform price elasticity analysis
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