The ice cream store cool stuff sells exotic ice creams, including Tropical Cream
ID: 3353616 • Letter: T
Question
The ice cream store cool stuff sells exotic ice creams, including Tropical Cream and Green Mango. Cool Stuff has been varying the prices of these two flavors over the past 16 quarters and has recorded the sales data. The table shows the quantity sold of Tropical Cream, Q, given the price of a half-gallon of Tropical Cream, P, and the price of the other flavor, Green Mango, Po. Use these data to estimate the demand function for Tropical Cream. Now assume that these data represent quarterly time series for four years (4*4=16). For this question, write down the estimated equation If the prices remain unchanged and the city continues to grow, use the Excel's regression tool to forecast the Ice Cream Store for the fifth year. Use quarterly dummy variables in your analysis.
Q P P0 210 21 13 205 23 15 213 22 15 208 23 16 205 24 16 210 23 16 218 21 13 201 25 18 205 25 18 198 26 18 205 24 17 195 26 18 222 21 19 156 25 15 189 24 14 198 20 18Explanation / Answer
Regression Analysis
R²
0.314
Adjusted R²
0.209
n
16
R
0.560
k
2
Std. Error
13.278
Dep. Var.
Q
ANOVA table
Source
SS
df
MS
F
p-value
Regression
1,049.6756
2
524.8378
2.98
.0862
Residual
2,292.0744
13
176.3134
Total
3,341.7500
15
Regression output
confidence interval
variables
coefficients
std. error
t (df=13)
p-value
95% lower
95% upper
Intercept
280.7243
45.5997
6.156
3.45E-05
182.2121
379.2365
P
-4.6524
1.9148
-2.430
.0303
-8.7890
-0.5158
P0
1.8600
1.8971
0.980
.3448
-2.2384
5.9585
The regression equation is
Q = 280.7243-4.6524*P+1.8600*Po.
Regression Analysis
R²
0.314
Adjusted R²
0.209
n
16
R
0.560
k
2
Std. Error
13.278
Dep. Var.
Q
ANOVA table
Source
SS
df
MS
F
p-value
Regression
1,049.6756
2
524.8378
2.98
.0862
Residual
2,292.0744
13
176.3134
Total
3,341.7500
15
Regression output
confidence interval
variables
coefficients
std. error
t (df=13)
p-value
95% lower
95% upper
Intercept
280.7243
45.5997
6.156
3.45E-05
182.2121
379.2365
P
-4.6524
1.9148
-2.430
.0303
-8.7890
-0.5158
P0
1.8600
1.8971
0.980
.3448
-2.2384
5.9585
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