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Assignment 01

This document contains 5 assignments related to managerial economics. The first two assignments involve using regression analysis to estimate market demand and supply equations from price and quantity data tables for commodities. The third assignment involves analyzing the effects of different factors on demand for cars. The fourth assignment involves interpreting a market demand equation for brand X and calculating demand. The fifth assignment asks whether a change in Prince's movie-going and restaurant eating can be inferred as a change in demand.

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Iftekhar Chowdhury Prince
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669 views2 pages

Assignment 01

This document contains 5 assignments related to managerial economics. The first two assignments involve using regression analysis to estimate market demand and supply equations from price and quantity data tables for commodities. The third assignment involves analyzing the effects of different factors on demand for cars. The fourth assignment involves interpreting a market demand equation for brand X and calculating demand. The fifth assignment asks whether a change in Prince's movie-going and restaurant eating can be inferred as a change in demand.

Uploaded by

Iftekhar Chowdhury Prince
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Assignment No: 01

Managerial Economics (MBA 507)


1. The following data table shows the market demand and price of a commodity during a period
of eight years:

Price 10 15 20 25 30 35 40 45
(Tk./kg)
Demand 650 600 580 520 430 400 365 200
(100 kg)

Requirements:
a) Estimate the market demand equation for the commodity using regression analysis.
b) Interpret the estimated equation.
c) Estimate the expected total market demand when price equals tk.55 (per kg).
d) Estimate the expected total market demand when price equals tk.61 (per kg).

2. The following data relates to the prices and supplies of a commodity during a period of ten
years:
Price 10 12 18 19 21 24 29 33 35 38
(Tk./kg)
Supply 30 35 45 46 65 68 70 75 78 82
(100 kg)

Requirements:
a) Estimate the market supply equation for the commodity using regression analysis.
b) Interpret the estimated equation.
c) Estimate the expected total market supply when price equals tk.50 (per kg).
d) Estimate the expected total market supply when price equals tk.70 (per kg).

3. Analyse the effects on the demand for cars of the following:


a. A higher tax on gasoline
b. A tax on car parking
c. Increased automation on subways
d. Government legislation for increased safety in cars, like side impact protection
e. A ‘congestion’ tax imposed on cars using certain routes at certain times.

4. The market demand for brand X has been estimated as

Qx = 1,500 - 3Px - 0.05I - 2.5Py + 7.5Pz

where Px is the price of brand X, I is per-capita income, Py is the price of brand Y, and Pz is the
price of brand Z. Assume that Px = $2, I = $20,000, Py = $4, and Pz = $4.
a. With respect to changes in per-capita income, what kind of good is brand X?
b. How are brands X and Y related?
c. How are brands X and Z related?
d. How are brands Z and Y related?
e. What is the market demand for brand X?

5. Because movie tickets have become more costly, Prince goes out to see movies less often and
hence is also eating out less in restaurants. Can we infer (guess that something is true because of
the information that you have) from this that there has been a change in demand by Prince for
movies but a change in quantity demanded for restaurant food?

Course Instructor:
Iftekhar Uddin Ahmed Chowdhury

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