# Demand Estimation and Forecasting, homework help College Paper Lab | collegepaperslab.com

Demand Estimation and Forecasting, homework help College Paper Lab | collegepaperslab.com

Demand Estimation and Forecasting

You are a manger of a large automobile dealership who wants to learn more about the effectiveness of various discount offered to customers over the past 14 months. Following are the average negotiated prices for each month and the quantities sold of a basic model (adjusted for various options) over this period of time.

1. Graph this information on a scatter plot, estimate the demand equation. What do the regression results indicate about the desirability of discounting the price? Explain.

 Month Price Quantity January \$12,500 15 February \$12,200 17 March \$11,900 16 April \$12,000 18 May \$11,800 20 June \$12,500 18 July \$11,700 22 August \$12,100 15 September \$11,400 22 October \$11,400 25 November \$11,200 24 December \$11,000 30 January \$10,800 25 February \$10,000 28

2. What other factors besides price might be included in this equation? Do you foresee any difficulty in obtaining these additional data or incorporating them in the regression analysis?