Question: Data Inc. produces price customization software called Buy It . Based on an analysis of monthly product sales over a one-year period, Data Inc.’s marketing department estimates the demand for Buy It to be:

QB = 1,200 - 8P _B + 4P _S

QB denotes units sold of Buy It software, P _B denotes Buy It’s price, and P _S denotes the price of a best-selling sales analytics software package (with both prices in dollars). The standard error of the estimate is 21.

1. Currently, P _B = $200 and P _S = $250. What is the predicted demand for Buy It software? (10 points)
2. An industry analyst comments that demand for Buy It is not very sensitive to changes in the price of the statistical software package P _S . Carefully assess this contention. Do you agree or disagree? (20 points)
3. A marketing department analyst realizes that a potentially important determinant of demand for Buy It software is the price of computer workstations. The analyst reruns the regression model and now includes the price of workstations along with the other variables. What statistics would you like to have – and why – to evaluate the estimate?

Price: $2.99

Solution: The downloadable solution consists of 2 pages
Deliverable: Word Document