Question

Can you help me confirm if my work is accurate.

Pauls Underground, a limited liability corporation specializing in new rap artists (B.U. LLC, rap) has the following demand function:

Q = a + bP + cM + dR

where Q is the quantity demanded of the most popular product B.U. sells, P is the price of that product, M is income, and R is the price of a related product. The regression results are:

Adjusted R Square	0.7514
Independent Variables	Coefficients	Standard Error	t Stat	P-value
Intercept	6309.15	87.382	72.202	5.17E-37
P	-5.201	1.039	-5.006	1.96E-05
M	0.0026	0.001	2.080	0.0456
R	2.10	1.131	1.856	0.0726

Now assume that the income is $60,200, the price of the related good is $17.95, and B.U. chooses to set the price of its product at $18.49.

b.   What is the estimated number of units sold given the data above? (round to nearest unit; no decimals) 6411

c.   What are the values for the own-price, income, and cross-price elasticities?

Price Elasticity = PE = dQ/dP * P/Q = -5.201 * (18.49/6,407) = -0.0150096  -.015

Income Elasticity = IE = c * M/Q = 0.0026 * (60,200/6,407) = 0.0244295  .024

Cross-price Elasticity = CPE = d * R/Q = 2.10 * (17.95/6,407) = 0.0058834 = .006

Answer 1

solution-に equation ie she re ncome Price of Related product FTO the given table the regression equadio0 Noo assume that me income = $ 60,000 e price oF related product Price of the pnoduct is 18 .49 Then the umber of unite sold is givenb a) 630916-5哑01 X 13,4 g t o.oo 26 xcoluo. 6407 198 6401 640t ite will be sblo Price - tlasticity -6-201 X 1g44

Date O O15 Income elastieity is gixen :00026 x60 200 Cross-price elasticty is giveby d R 0-10 x 1グ-35 О-00688 Сре