Turn It In Essay

Submitted By SwiftoneDelaney
Words: 1668
Pages: 7
Open Document
Demand estimation allows a company to measure the amount of demand a business should produce for their product or service. An estimate can give the management team a range on production levels and help to make important company decisions. In reference to Option 1, the demand equation is for the brand product that uses data from 26 supermarkets around the country for the month of April. Management asked employees to compute the elasticity’s for each independent variable.
As a maker of a leading brand of low-calorie, frozen microwavable food it is important to compute elasticity’s for quantity demanded, price of the product, price of leading competitors, per capita income of the metropolitan statistical area, and monthly advertising expenditures. The elasticity’s of these variables are able to establish short-term and long-term pricing strategies for the company. Price is often the single most important factor in a customer’s decision when purchasing a product. It is necessary to determine how price will affect the demand and supply of the product. Moreover, it is essential to conclude what other factors may play a role in the shifts of demand and supply (McGuigan, Moyer and Harris, 2014).
Below is a regression equation and the calculations for each independent variable.
QD= -5200 - 42P + 20Px +5.2I + .20A + .25M
(2.002) (17.5) (6.2) (2.5) (0.09) (0.21)
R2 = 0.55 n = 26 F = 4.88
The elasticity’s for each independent variable are as follows:
Q = Quantity demanded of 3-pack units
P (in cents) = Price of the product = 500 cents per 3-pack unit
PX (in cents) = Price of leading competitor’s product = 600 cents per 3-pack unit
I (in dollars) = Per capita income of the standard metropolitan statistical area (SMSA) in which the supermarkets are located = $5,500
A (in dollars) = Monthly advertising expenditures = $10,000
M = Number of microwave ovens sold in the SMSA in which the supermarkets are located = 5,000
P= 500, PX=600, I=5,500, A=10,000, M=5,000
QD= -5200 -42(500) +20(600) +5.2(5500) +.20(10000) +.25(5000) =
QD = -5200-21000+12000+28600+2000+1250= 17,650
The elasticity for each independent variable are:
Price Elasticity (Ep) = (dQ/dP) (P/QD)
EP= (-42) (500/17650) = -1.19
Advertising Elasticity (EA) = EA = (dQ/dP) (A/QD)
EA= (.20) (10000/17650) = .11
Income Elasticity (EI) = EI = (dQ/dP) (I/QD)
EI= (5.2) (5500/17650) =1.62
Microwave Elasticity = EM = (dQ/dP) (M/QD)
EM= (.25) (5000/17650) = .07
Competitive Price Elasticity = EPx = (dQ/dP) (PX/QD)
EPx= (20) (600/17650) =.68
Supply change or quantity demand are measured by elasticity in any variables that influence the demand and supply functions. Price elasticity is a ratio of the percentage change in the quantity demand to the percentage change in the price, assuming that all other factors manipulating the demand remain unchanged (McGuigan, Moyer and Harris, 2014).
After calculating the elasticity’s for each variable, in terms of long-term and short term-pricing can be brainstormed. The price elasticity is -1.19. The demand for goods and services are affected by price when the value is greater than 1 and is insensitive to price when the value is less than 1(Investopedia, 2014). With the price elasticity being -1.19, what that represents is that as price goes up by some percent change, and then the quantity goes down by that percent change multiplied by -1.19. As a result, the product would be considered elastic. When the demand of a good is elastic, a drop in price will increase sales and plays a critical role in long-term and short-term pricing strategies. Demand elasticity can assist in forecasting long-term profit. A company can set prices based on desired levels of profits they wish to obtain over a period of time. Demand elasticity enables a company to foresee the percentages in which the quantity of the product will increase or decrease
Show More

Related Documents: Turn It In Essay

Foreshadowing In The Turn Of The Screw

In “The Turn of the Screw”, foreshadowing is often used. Foreshadowing is an indication or warning of the future. Throughout the whole story, there sections in which a literary device is used by the author to give hints. The reader can have an educational guess in what will happen next in the story. Whether it be the actions of the characters or the scene of the next chapter, we can often guess what will happen next. In addition, the authors show of foreshadowing creates layers throughout the whole…

Words 596 - Pages 3

Essay On The Turn Of The Screw

Kat L. Van Deren College Prep English 6 March, 2013 The Turn of the Screw The phrase “turn of the screw” means to make a bad situation worse, especially in order to force someone to do something. The book “The Turn of the Screw”, written by Henry James, is about a bad situation escalating into a horrendous situation. This book is about a 20 year old woman who becomes a governess for two young children, whose names are Miles and Flora. She works for a man whose only rule is for her not to…

Words 1237 - Pages 5

Turn It In Analysis Essay

Turn-it-in Analysis Dianne Flannery CS204 Professional Presence July 1, 2015 Kaplan College Professor M. Laska Introduction The professional categories that best represents my desired career field are medical professional and law enforcement. I would like to be either a medical examiner or a forensic lab technician. These two professions are what appeals to me the most. Upon viewing the slides, I noticed that all were very professional. Part 1: View and Analysis Law Enforcement: Fire…

Words 799 - Pages 4

Wrong Turn Essay

granted every day. Something much bigger, such as life, is so precious, and yet it can be pulled out from under us in an instant. We don’t realize how quickly it can be taken. My friends and I realized this one summer night, when a fun time took a turn for the worse. It was a starry, summer night in Hays, America. Tessa, Jordan, and I were driving around, doing the normal activities for a summer night. I just got a new car, so driving around had been a typical event on most nights. We started running…

Words 1446 - Pages 6

Turn Of The Screw Analysis

The governess in Turn of the Screw by Henry James is the definition of a tragic hero. It is hard to see anything but a tragic end to her story. The governess seems to accept her madness as reality right away. After the second supposed haunting the young governess confides in her friend, Mrs. Grose about what she saw and the only way she describes the being at first is incredibly vague “‘I've been dying to tell you. But he's like nobody.’” (James 19). Than sensing the confusion of her friend, she…

Words 403 - Pages 2

How To Turn In Work

The purpose of this assignment is so you know how to turn in work for the rest of the semester in my class and along with rewriting my statements, you will learn some things about how your class works. Your First Assignment How to turn in the work: Type into this document, save as you go, then after you are finished, highlight the entire sheet, copy it, then click to the Dropbox, find the Assignment and paste it into the box. I show you how to do this in the Video on the home page. Directions:…

Words 358 - Pages 2

The Turn Of The Screw Analysis

notion that everything will be perfect and wonderful. What she doesn’t account for is the madness that flows through her head. Henry James gives these internal events a sense of excitement and suspense, similar to that of external actions. The book, The Turn of the Screw by Henry James, is written from the perspective of the governess. It is the retelling of events that happened to her ten years prior. Whether these horrific ghost stories are true or not is completely up to the reader. James brings the…

Words 1154 - Pages 5

ProfessionalDevelopmentAssignment8 Turn Essay

there is evidence that new and expensive technologies are being used inappropriately to generate income. One example of this statement would be the use of magnetic resonance imaging or MRIs. The popularity of this testing has skyrocketed and has in turn been found to be very profitable for hospitals and outpatient facilities. Despite the swooping popularity and booming financial boost this testing has been found not to change patient outcomes. The testing gives providers a clear look at the disease…

Words 2185 - Pages 9

Role Analysis: The Turn Of The Screw

Shereen Siewert Professor Ellen Bluestone Literature 500 13 March 2015 The Turn of the Screw: A Character Role Analysis Russian formalist Vladimir Propp identified seven possible character roles, called spheres of action, that are commonly found in Russian folk tales and other narrative works. Using Propp’s theory about roles, each character in the Henry James novella, The Turn of the Screw, can fit into at least one of Propp’s defined roles, though several characters fall into more than one category…

Words 1002 - Pages 5

The Importance Of Turn Up In Hamlet

When I turn up I do it for the team! Sometimes I want to do it for myself, but analytically that may not be possible. The pleasure aroused from my team is enough to make me a happy camper. Camping is pretty fun too I must say. Turning up is fun too. Anyone ever tried Bacardi black razz? That's my turn up sauce for when I turn up. Denmark was found to be the happiest country in 2012, but The Melancholy Dane never got the memo. Don't let poor Hamlet spend another cold winter moping, cuddling…

Words 318 - Pages 2