ECON 3305
CASE 2 COST STRCTURE and PRICING: Sting Ray
1. Run the appropriate regression to estimate the average variable cost function (AVC) for Sting Rays.
Evaluate the statistical significance of the three estimated parameters using a significance level
ECON 3305 Managerial Economics
Homework 3
The homework covers Ch 8~10. It has to be your individual work. Copying answer from
others will violate ACADEMIC HONESTY policy to cause a failing grade. For each
question, please show the necessary derivation (if
Ch.3 Hw
4 out of 4 points
If the price of a substitute increases, which of the following is most likely to happen in
the
market for the product under consideration in the short run?
Selected
Answer:
Firms will devote more variable inputs in the productio
Ch 4 HW
Question 1
4 out of 4 points
When purchases of tennis socks decline following an increase in the price of tennis
sneakers (other things remaining equal), the relationship between these two items can be
described as
Selected Answer: complementary.
CH 5 HW
Question 1
4 out of 4 points
In regression analysis, the variable that is being predicted is the
Selected
Answer:
dependent
variable
Question 2
4 out of 4 points
In a regression analysis if r
= 1, then
2
SSE must be equal to
zero
Question 3
Selec
Chapter 6 HW
Question 1
5 out of 5 points
A firm using two inputs, X and Y, is using them in the most efficient
manner when
MPX/MPY =
PX/PY
Question 2
Selected
Answer:
5 out of 5 points
Decreasing returns to scale
Selected
Answer:
None of the above is
tru
Stephanie Acosta
ECON 3305 Dr. Chen
CASE 2 COST STRCTURE and PRICING: Sting Ray
1. Run the appropriate regression to estimate the average variable cost function (AVC) for Sting Rays.
Evaluate the statistical significance of the three estimated parameters
1. The linear demand estimation is as follows for the 48 contiguous states:
Coefficients Standard Error t Stat
Intercept
159.17
94.16
1.69
Price
-102.56
33.25
-3.08
Income
1.00
1.77
0.57
Temperature
3.94
0.82
4.83
Note that price and temperature are signi