The Strategy, Tactics, and Economics of Pricing
Essay by pooja gupta • August 25, 2016 • Coursework • 586 Words (3 Pages) • 951 Views
The Strategy, Tactics, and Economics of Pricing
Final Exam, Aug 2016 (Time Limit: 1 hour)
PART II
Name: Haveen ID:1511396
This is an individual exam. Please type your name below the following statement to indicate that you honored the individual nature of this exam.
On my honor, I declare that all the answers below are a result of my individual work. I have neither given nor received help during this exam.
- Estimate a linear regression of Nabisco-Sales as a function of prices (Nabisco & Keebler) and Display & Feature levels (Nabisco & Keebler)
- Paste the regression statistics in the space below
[pic 1]
- Ignoring statistical significance, interpret the coefficients of the linear regression.
- Specifically, based on the regression coefficients what is the nature of the relationship between Nabisco and Keebler (substitutes or complements)
varible 4 | varible 2 |
K - Price | N -Price |
1.109794208 | -1.871078 |
From the table it is clear that increase in price of k leads to increase in sales of N, thus indicating that both are substitute to each other
- Interpret the regression coefficients for Display & Feature variable. Explain in what way they do/do not make sense to you, given the relationship you described above.
varible 1 | varible 3 |
N- D+F | K- D+F |
-9.431407208 | -14.68658528 |
From the table it is clear that both increase in Display & feature for N as well as K, reduces the sales of N
What doesn’t makes sense is that as both K & N are substitutes increase in features & display of one should increase the sale of the other. But instead of this it reduces the sale irrespective of who increase the display & features
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