Scribd Logo
Upload

Welcome to Scribd!

  • Poolvac Ansawers

    Uploaded by

    wasif ahmed
    5 views1 page
    The regression results show that the parameter estimates for both the variable cost and demand equations are statistically significant and have the required signs. The variable cost function is U-shaped, with average and marginal costs both being U-shaped as well. Minimum average variable cost occurs at a quantity of 1407.8, where AVC is $109.65. Demand is downward sloping, with pool cleaners being a normal good and the two companies selling substitute goods. At a price of $296.22, quantity demanded is 1725.8, total revenue is $511,221 and total cost is $238,049, resulting in a profit of $273,172.

    Original Description:

    Original Title

    poolvac ansawers

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    The regression results show that the parameter estimates for both the variable cost and demand equations are statistically significant and have the required signs. The variable cost function is U-shaped, with average and marginal costs both being U-shaped as well. Minimum average variable cost occurs at a quantity of 1407.8, where AVC is $109.65. Demand is downward sloping, with pool cleaners being a normal good and the two companies selling substitute goods. At a price of $296.22, quantity demanded is 1725.8, total revenue is $511,221 and total cost is $238,049, resulting in a profit of $273,172.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    5 views1 page

    Poolvac Ansawers

    Uploaded by

    wasif ahmed
    The regression results show that the parameter estimates for both the variable cost and demand equations are statistically significant and have the required signs. The variable cost function is U-shaped, with average and marginal costs both being U-shaped as well. Minimum average variable cost occurs at a quantity of 1407.8, where AVC is $109.65. Demand is downward sloping, with pool cleaners being a normal good and the two companies selling substitute goods. At a price of $296.22, quantity demanded is 1725.8, total revenue is $511,221 and total cost is $238,049, resulting in a profit of $273,172.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 1

    a.

    Regression results for variable cost (table)

    The parameter estimates â , b̂ , and ĉ are all statistically significant at the 5 percent level or
    better. The parameter estimates have the required signs for a U-shaped AVC function: aˆ  0 ,
    bˆ  0 , and cˆ  0 .
    b. TVC  152.881Q  0.06141Q  0.00002181Q
    2 3

    AVC  152.881  0.06141Q  0.00002181Q 2


    MC  152.881  0.12282Q  0.00006543Q 2
    Qmin  1407.8 AVC  $109.65
    c. and

    a-Regression result for Demand (table)


    ˆ
    The parameter estimates ê , f , and ĝ are all statistically significant at the 5 percent level or
    better.
    eˆ  0 as required by the law of demand.
    fˆ  0 indicates Sting Rays are normal (not inferior) goods.
    gˆ  0 indicates PoolVac and Howard Industries are selling substitute (not complement) goods.
    Qd  4912.60  10.7582 P
    b. Demand:
    P  456.6377  0.09295Qd
    Inverse Demand:
    MR  456.6377  0.18590Qd
    Marginal Revenue:
    3. P = $296.22; Q = 1725.8; TR = $511,221; TC = $238,049; Profit = $273,172.
    4. E = –1.8465; increase, 9.2; rise; fall
    5. EM = 0.8067
    a. Yes, pool cleaners for swimming pools are likely to be normal goods not inferior goods.
    b. Increase; 8.1
    6. EXR = 0.4586
    a. Yes, PoolVac and Howard Industries are selling substitute goods not complement goods.
    b. Decrease; 1.4
    7. P = $296.22; Q = 1725.8; TR = $511,221; TC = $248,049; Profit = $263,172.
    8. $228.32; $187,588; lower than

    You might also like