Reference no: EM13188812
The research department of the Corn Flakes Corporation ( CFC) estimated the following regression for the demand of the cornfl akes it sells: Q X = 1.0 - 2.0P X + 1.5I + 0.8P Y - 3.0P M + 1.0A
where Q X = sales of CFC cornfl akes, in millions of 10- ounce boxes per year
P X = the price of CFC cornfl akes, in dollars per 10- ounce box I = personal disposable income, in trillions of dollars per year P Y = price of competitive brand of cornfl akes, in dollars per 10- ounce box P M = price of milk, in dollars per quart A = advertising expenditures of CFC cornfl akes, in hundreds of thousands of dollars per year This year, P X = $ 2, I = $ 4, P Y = $ 2.50, P M = $ 1, and A = $ 2.
( a) Calculate the sales of CFC cornfl akes this year.
( b) Calculate the elasticity of sales with respect to each variable in the demand function.
( c) Estimate the level of sales next year if CFC reduces P X by 10 percent and increases advertising by 20 percent, I rises by 5 percent, P Y is reduced by 10 percent, and P M remains unchanged.
( d) By how much should CFC change its advertising if it wants its sales to be 30 percent higher than this year?
|
Find the percentage increase in tuition at both universities
: Pitt and Penn State must decide on next year's in-state tuition for full-time undergraduate studnets. Pitt plans to increase Pitt tuition by 4% plus on half o Penn State's percentage increase in tution. Similarly, Penn State plans to i..
|
|
What is the lowers race time
: Horse race time is found to be normally distributed with a mean value of 18 minutes and a standard deviation of 4 minutes. Horses whose race time is in the top 6% will not be eligible to participate in a second round. What is the lowers race time ..
|
|
At what rate is the supply changing
: If 36000 cartons of eggs are available at the beginning of a certain week and the price is falling at the rate of 2¢/carton/week, at what rate is the supply changing? (Round your answer to the nearest whole number.) (Hint: To find the value of p w..
|
|
What would be the standard deviation
: 89 students found that 22% were in favor of raising tution to build a new math building. The standard deviation of this poll is 7%. What would be the standard deviation if the sample size were increased from 89 to 189?
|
|
Calculate the sales of cfc cornflakes this year
: competitive brand of cornfl akes, in dollars per 10- ounce box P M = price of milk, in dollars per quart A = advertising expenditures of CFC cornfl akes, in hundreds of thousands of dollars per year This year, P X = $ 2, I = $ 4, P Y = $ 2.50, P M..
|
|
At what rate is the distance from the plane to the radar
: A plane flying with a constant speed of 390 km/h passes over a ground radar station at an altitude of 2 km and climbs at an angle of 30 degrees. At what rate is the distance from the plane to the radar station increasing a minute later? (Round you..
|
|
What was the original price
: the jewwelry store is having a 30% off sale. the sale price of a watch is 249.90,what was the original price.
|
|
How to encourage contributions from consumers
: The textbook provides three techniques that not-for-profit organizations use to deal with the free-rider problem. Create two additional techniques that these organizations can use to encourage contributions from consumers.
|
|
What is the lowest salary
: I want to be earning an annual salary of $100,000 when I retire in 21 years. I have been offered a job that guarantees an annual salary increase of 4% per year, and the starting salary is negotiable. What is the lowest salary that I should request..
|