Sagot :
Answer:
The predicted value of sales is $75,037,500.
Explanation:
Given:
Q = 875 + 6XA + 15Y - 5P ……………………..(1)
Where:
Q = quantity sold = ?
XA = Advertising = $100,000
Y = Income = $10,000
P = Price = $100
Substituting the values into equation (1), we have:
Q = 875 + (6 * 100,000) + (15 * 10,000) - (5 * 100)
Q = 750,375
Therefore, we have:
Predicted value of sales = Q * P = 750,375 * $100 = $75,037,500
Therefore, the predicted value of sales is $75,037,500.
From the fitted regression, the predicted value of sales will be 1125.
The estimated demand function is given as:
Q = 875 + 6XA + 15Y − 5P
The explanatory variables will be:
Advertising = $100,000 = 100
Income = $10,000 = 10
Price = $100
The values will be put in the estimated equation and this will be:
Q = 875 + 6XA + 15Y − 5P
Q = 875 + (6 × 100) + (15 × 10) - (5 × 100)
Q = 875 + 600 + 150 - 500
Q = 1125
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