Assignment
You have been retained by a regional food marketer, FoodKing, to forecast the demand for small cakes that are mass-produced and marketed under the name Big Suzy's Snack Cakes. To assist with your analysis, you are provided with data that was collected for 8 consecutive quarters and 6 geographic markets. (Note: THE DATA IS CONTAINED IN THE EXCEL FILE LABELED "BIG SUZY.XLSX"). EITHER CIRCLE or BOLD all Final Answers.
Estimate a regression model that expresses sales as a function of price, income, competitor's price and population. Having done that, you are asked to address the following questions.
(a) Estimate a regression model that expresses sales as a function of price, income and competitor's price and population? Once you have estimates the regression model, (a) provide a clear interpretation of the "R2 " and (b) the statistical significant of the overall regression. Be sure to explain if the overall regression is statistically significant at a 5% level and how you know that.
(b) Can you provide a clear, concise interpretation for the slope coefficient on price? Is that coefficient significantly different from zero at the 5% level? How do you know that?
(c) FoodKing is considering entering a new market. In this market, the population is 2,750,000, the average (or per capita) income is $46,500 and the competitor's product sells for $4.75. Using this regression model, if you price your product at $5.50, how many pies will you sell? BE VERY CAREFUL WITH THE UNITS OF MEAUREMENT - FOR EXAMPLE: NOTE THAT THE PRICES IN THE DATA SET ARE MEASURED IN CENTS. SHOW YOUR WORK.
At $5.50, we will sell ______________ pies.
(d) One of your assistants notes that the market that you are considering entering is located in the southern part of the nation. She asserts that "everyone knows that southerners eat lots of snack cakes." You note that in your data set, Atlanta and Dallas are the only two cities that are in the "South" census district. Can you test you assistant's hypothesis that "southerners eat lots of snack cakes"? If so, is she correct? If so, how many more snake cakes do Southerners eat than their comparable non-southerners? SHOW YOUR WORK.
Do Southerners eat more stack cakes than non-Southerners? YES or NO
If "Yes", how many more? They eat _________________ more cakes.
(e) Ignore the issue about Southerners in (d). Instead, one of your assistants suggests that there is a significant seasonal effect on the consumption of snack cakes. Specifically, he suggests that "people each more snack cakes during that holiday season (October through December)". Can you test you assistant's hypothesis? If so, is she correct? If so, how many more snack cakes do they eat doing the holiday season? SHOW YOUR WORK. (hint: use a dummy variable)
Do we sell more stack cakes during the holiday season?
YES or NO (circle one)
If "Yes", how many more? They eat _________________ more cakes.
Attachment:- big_suzy.rar