Question;The following question refers to this regression equation. (Standard errors in parentheses)Qd= 15 - 10 P + 1.5 Adv + 0.4 Px + 2 I(5.23) (2.29) (0.525) (1.75) (1.5)R^2 = 0.65N = 120F = 35.25Standard error of Y estimate = 0.565Qd = Quantity demandedConsider the case when:P = Price = 7Adv = Advertising expense = 54Px = price of competitor's good = 8I = average monthly income = 4a. Calculate the elasticity for each variable at that point and briefly comment on what information this gives you for each variable.b. Should this firm be concerned if macroeconomic forecasters predict a recession? Explain your answer.
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