Homebase (Pty) Ltd is the manufacturer of a robot vacuum cleaner, iRobot-H. It uses built-in cameras and sensors to find its way around a home without fuss. It has different cleaning modes and advanced features such as the ability to produce maps of where it has cleaned and for how long. It really takes the drudge out of vacuum-cleaning homes.
The company sells this product through 55 independent retail stores across the country. Homebase's marketing research team developed the demand equation below for iRobot-H, based on its average retail sales over the last 18 months.
Q = 5 200-42P+ 20Pc + 5.2Y + 0.2A + 0.25S
(2.002) (17.5) (6.2) (2.5) (0.09) (0.21)
R² = 0.55 n = 55 F = 4.88
The following are the independent variables and their current values:
• Q = quantity sold per month (sales)
• P (in rand) = Price of iRobot-H = R2 900
Pc (in rand) = Price of leading competitor's product = R3 200 Y (in rand) = Average per capita income in the country = R25 000
• A (in rand) = Homebase's monthly advertising expenditure = R20 000
. S (in units) = Number of robot vacuum cleaners sold across the country = 7000
F (critical value) = 3.38 at 5% level of significance
Show all calculations and relevant formulas.
What is the meaning of the parameters -42P, 20Pc and 5.2Y?
Homebase (Pty) Ltd is the manufacturer of a robot vacuum cleaner, iRobot-H. It uses built-in cameras and sensors to find its way around a home without fuss. It has different cleaning modes and advanced features such as the ability to produce maps of where it has cleaned and for how long. It really takes the drudge out of vacuum-cleaning homes.
The company sells this product through 55 independent retail stores across the country. Homebase's marketing research team developed the demand equation below for iRobot-H, based on its average retail sales over the last 18 months.
Q = 5 200-42P+ 20Pc + 5.2Y + 0.2A + 0.25S
(2.002) (17.5) (6.2) (2.5) (0.09) (0.21)
R² = 0.55 n = 55 F = 4.88
The following are the independent variables and their current values:
• Q = quantity sold per month (sales)
• P (in rand) = Price of iRobot-H = R2 900
Pc (in rand) = Price of leading competitor's product = R3 200 Y (in rand) = Average per capita income in the country = R25 000
• A (in rand) = Homebase's monthly advertising expenditure = R20 000
. S (in units) = Number of robot vacuum cleaners sold across the country = 7000
F (critical value) = 3.38 at 5% level of significance
Show all calculations and relevant formulas.
What is the meaning of the parameters -42P, 20Pc and 5.2Y?
