Regression Report

ECO 501: Managerial Economics

ASSIGNMENT:

REGRESSION & ELASTICITY

Course Instructor

Professor Dr. Jamshed uz Zaman

Prepared By

Maruf Shahjahan Md. Moeid Hasan Md. Tahamidur Rahman Shoeb Hasan Biplob Saha Md. Nazmul Hasan Sarkar

ID: 09364002 ID: 10264007 ID: 10264024 ID: 10164054 ID: 10164022 ID: 10164045

Date of Submission: 4th March 1, 2011

Introduction

In economics the Demand theory is one of the most important theories that give many insightful suggestions in making any business. Demand theory describes the relationship of the demand of a product with the price of the product. There are other factors that also influence in the change of demand. To understand the strength of these relationships and what they depict, we use Elasticity as a measure to estimate to what extent demand changes with the change of other factors. The regression analysis is a part of calculating the elasticity and the strength of relationship different independent variables have with the dependent variable.

Objective

Our main objective in the making of this report is to understand the elasticity of demand and how different factors like price, competitor price, advertising expenditure, and income of the customers are related with the quantity demanded of bread as a product.

Data

The data for this report was collected from in the internet. The data is from San Francisco Bread Company. It shows the demand for Bread in different markets at different price levels. The data also shows the competitor price, the advertising expenditure by the company and income level of the customers in different markets and price levels. The quantity demanded of bread is considered as the Dependent Variable and Price of bread, competitor price, advertising expenditure, and income of customers are considered as Independent Variable according to the objective of the study. The data set consists of 30 sets of data to get more accurate results.

The equation to formulate the...