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Unformatted text preview: n, answer the following questions: 1. Compute elasticities for each of the variables. [5 marks] 2. How concerned do you think this company would be about the impact of a recession on its sales? Explain. [5 marks] 3. Do you think that this firm should cut its price to increase its market share? Explain. [5 marks] 3 BMME5103/SEPT 07-F/KN 4. What proportion of the variation in sales is explained by the independent variables in the equations? How confident are you about this answer? Explain. [5 marks] [TOTAL : 20 MARKS] 4 BMME5103/SEPT 07-F/KN Question 3 You are given the following: Production = quantity of output (tonnes), Labour = amount of labour used to produce the output (man-days), Capital = value of capital used to produced output (RM), lnprod = natural log of production, lnlab = natural log of labour, and lncap = natural log of capital. Based on the results of the regression analysis as shown in the following tables, answer the following questions: 1. What is the dependent variable in this production st...
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This document was uploaded on 02/09/2014.

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