Question

Suppose the Kalamazoo Brewing Company (KBC) currently sells its microbrews in a seven-state area: Illinois, Indiana, Michigan, Minnesota, Mississippi, Ohio, and Wisconsin. The company’s marketing department has collected data from its distributors in each state. This data consists of the quantity and price (per case) of microbrews sold in each state, as well as the average income (in thousands of dollars) of consumers living in various regions of each state. The data for each state are available via the link below--please note there are multiple tabs at the bottom of the spreadsheet, each refers to one of the seven states selling the Kalamazoo Brewing Company’s microbrews.

Assuming that the underlying demand relation is a linear function of price and income, use your spreadsheet program to obtain least squares estimates of Ohio’s demand for KBC microbrews.

Instruction: If the estimate is negative, enter a negative number (-) in the equation. Enter your responses rounded to two decimal places.

Q =  _______ + _______ Price + _______ Income

Data for Ohio

Quantity	Price	Income
286	28.09	36.08
75	27.68	5.17
351	28.48	43.92
313	30.24	37.28
368	28.4	47.62
316	26.83	37.65
203	28.18	23.22
205	30.91	22.62
321	30.87	41.12
233	31.56	28.3
261	31.51	32.3
148	30.18	17.17
301	31.95	37.68
270	30.31	34.39
267	27.16	31.65
136	30.25	15.71
394	31.03	51.04
259	30.19	31.05
271	30.82	32.53
264	32.69	35.04
344	28.53	43.82
381	29	48.94
399	30.36	51.63
134	29.34	14.3
158	28.05	14.67
299	25.08	35
205	25.15	24.15
347	28.6	44.22
226	32.75	27.24
249	29.01	29.41
231	30.53	28.61
306	28.46	36.06
363	30.64	46.77
292	33.88	37.25
379	29.34	49.01
419	29.76	52.13
305	31.41	33.75
92	29.76	8.7
273	29.7	31.09
193	26.37	22.47
333	32.81	44.68
191	28.22	21
164	29.38	18.98
257	27.25	27.92
311	30.57	36.99
408	30.07	54.36
281	28.3	36.64
310	28.29	38.53
308	33.85	43.3
285	29.69	35.18

Answer 1

Excel output:

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.991910298
R Square	0.98388604
Adjusted R Square	0.98320034
Standard Error	10.6253795
Observations	50
ANOVA
	df	SS	MS	F	Significance F
Regression	2	323988.2616	161994.1	1434.863	7.40037E-43
Residual	47	5306.238411	112.8987
Total	49	329294.5
	Coefficients	Standard Error	t Stat	P-value	Lower 95%	Upper 95%
Intercept	111.0588308	23.03974217	4.820316	1.54E-05	64.70884801	157.4088135
Price	-2.47673877	0.79311102	-3.12281	0.003064	-4.072272339	-0.881205198
Income	7.031529614	0.132769289	52.96051	1.47E-43	6.764432256	7.298626972

Q =  111.06 - 2.48 Price + 7.03 Income