Estimate the demand for ice cream in his father parlor

Assignment Help Business Economics

Reference no: EM13159789

The Ice Cream Parlor is the only ice cream parlor in Smithtown. Michael, the son of the owner, has just come back from college, where he majors in business administration. In his course in managerial economics, Michael has just studied demand analysis, and he decides to apply what he has learned to estimate the demand for ice cream in his father's parlor during his summer vacation. Using regression analysis, Michael estimates the following demand function:

where the subscript I refers to ice cream portions served per day in his father's parlor, and P_1 is the dollar price.

Michael then sets out to

A) derive the demand schedule for ice cream and plot it

B) find the point price elasticity of demand at each dollar price, from P=$6 to P=$0

C) find the arc price elasticity of demand between consecutive dollar prices (o.e., between P=$6 and P=$5, P=$5 and P=$4, and so on). Show how Michael would get his results

Reference no: EM13159789

Questions Cloud

Report of client-s request by summarizing research : Write a 1,050- to 1,400-word paper that addresses your client's request by summarizing research from the FASB Accounting Standards Codification website and other sources.

What is an allele : What is the krebs cycle and where does it take place andwhat does it do?

Write a loop that fills a vector : Write a loop that fills a vector V with ten different random numbers between 1 and 100. output must actually display the random numbers to get credit.

What is the equivalent uniform annual cost of one machine : What is the equivalent uniform annual cost of one machine in years 1 through 7 at an interest rate of 7% per year?

Estimate the demand for ice cream in his father parlor : what he has learned to estimate the demand for ice cream in his father's parlor during his summer vacation. Using regression analysis.

Describe the role of water as a component of digestivejuices : Describe the role of water as a component of digestivejuices.

State mass of magnesium : mass of magnesium = .021 grams initial volume = 50.00 mL final volume = 25.6 volume of liquid displaced = 24.4 volume of hydrogen gas produced = 24.4?

What is the amount of interest in the first payment : How long will it take, in months, to pay off the balance, if the cardholder continues to make payments of $110.25 per month and adds no other charges to the card?

Permanently restricted resources not for profit accounting : Provide examples of resources that are temporarily restricted as to: (a) purpose; (b) time; and (c) the occurrence of a specific event. Provide an example of permanently restricted resources. not for profit accounting.

User Account

All Pages