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    Assignment 1: Demand EstimationDue Week 3 and worth 200 points
    Imagine that you work for the maker of a leading brand of low-calorie frozen microwavable food that estimates the following demand equation for its product using data from 26 supermarkets around the country for the month of April.
    For a refresher on independent and dependent variables please go to Sophias Website and review the Independent and Dependent Variables tutorial located at http://www.sophia.org/tutorials/independent-and-dependent-variables–3.
    Option 1Note: The following is a regression equation. Standard errors are in parentheses for the demand for widgets.QD = – 5200 – 42P + 20PX+ 5.2I + 0.20A + 0.25M(2.002) (17.5) (6.2) (2.5) (0.09) (0.21)R2 = 0.55 n = 26 F = 4.88
    Your supervisor has asked you to compute the elasticities for each independent variable. Assume the following values for the independent variables:
    Q = Quantity demanded of 3-pack unitsP (in cents) = Price of the product = 500 cents per 3-pack unitPX(in cents) = Price of leading competitors product = 600 cents per 3-pack unitI (in dollars) = Per capita income of the standard metropolitan statistical area(SMSA) in which the supermarkets are located = $5500A (in dollars) = Monthly advertising expenditures = $10000M = Number of microwave ovens sold in the SMSA in which thesupermarkets are located = 5000
    Option 2Note: The following is a regression equation. Standard errors are in parentheses for the demand for widgets.
    QD = -2000 – 100P + 15A + 25PX+ 10I(5234) (2.29) (525) (1.75) (1.5)R2 = 0.85 n = 120 F = 35.25
    Your supervisor has asked you to compute the elasticities for each independent variable. Assume the following values for the independent variables:
    Q = Quantity demanded of 3-pack unitsP (in cents) = Price of the product = 200 cents per 3-pack unitPX (in cents) = Price of leading competitors product = 300 cents per 3-pack unitI (in dollars) = Per capita income of the standard metropolitan statistical area(SMSA) in which the supermarkets are located = $5000A (in dollars) = Monthly advertising expenditures = $640
    Write a four to six (4-6) page paper in which you:
    Your assignment must follow these formatting requirements:
    The specific course learning outcomes associated with this assignment are:

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