Eco 550 Assignment 1 Demand Estimation Low-Calorie, Frozen

Demand EstimationName of the StudentCourseProfessorUniversityDateDemand EstimationCompute the elasticity for each independent variable. Note: Write down all of your calculations.For option 2QD = -2,000 - 100P + 15A + 25PX + 10I(5,234) (2.29) (525) (1.75) (1.5)R2 = 0.85 n = 120 F = 35.25Your 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 competitor’s 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 = $5,000A (in dollars) = Monthly advertising expenditures = $640Given,P = 200, PX = 300, I= 5000, A= 640In the regression equation,Quantity demanded = - 2000 - 100P + 25PX + 10I + 15A Now, QD= -2000 – 100 (200) + 25 (300) + 10 * 5000+15*640 = 45100 unitsPrice elasticity Price elasticity =