Eco 550 Week 3 Assignment 1 Demand Estimation And Forecasting
Week 3 Discussion "Managing in the Global Economy and Outsourcing Offshore" Please respond to the following:From the scenario for Katrina’s Candies, assuming the absence of quantitative data, determine the qualitative forecasting techniques that could be used within this scenario. Now, assume you have acquired some time series data that would enable you to make forecasts. Ascertain the quantitative technique that will provide you with the most accurateforecast.Some qualitative technique that would be most useful in Katrina’s Candies scenario that could provide the most accurate forecasting data would be:Consumer Surveys – This would be a method in which the consumer would do personal interviews and/or questionnaires to determine what the consumer likes and to do research on their purchases. Delphi Method – In this technique, a panel of experts are questioned and the results are summarized and a consensus is reached for all of them.
DEMAND ESTIMATIONTimes have changed when it comes to the way families eat their meals on a daily basis. Most families are always on the run. Whether it they are parents who are working long hours, kids are involved in multiple sports or after school academic activities, or just not being able to settle down for a regular family meal, it’s just not enough time in the day to cook. Everything in life has become very fast. It’s easier and sometimes cheaper to just grab something to eat on the run at a fast food restaurant than it is to go shopping and prepare a meal. It is also easier to just throw something in the microwave for 1.5 minutes and have to do nothing else to it but eat. These have become very popular and affordable meal choices as well. In this assignment, I will compute the elasticities for each independent variable, plot the demand and supply curves, and identify crucial factors that would case shifts in the demand and supply curve for this low calorie, frozen microwavable food. Computation of Elasticities for Each Independent Variable QD =-2000 – 100P + 15A + 25PX + 10I(5234)(2.29)(525)(1.75)(1.5)R2 = 0.85n = 120F = 35.25Q =Quantity demanded of 3-pack unitsP (in cents) =Price of the product = 200 cents per 3-pack unitPX (in cents) =Price of leading competitor’s product = 300 cents per 3-pack unitI (in dollars)=Per capita income of the standard metropolitan statistical area (SMSA) in which the supermarkets are located = $5000A (in dollars)=Monthly advertising expenditures = $640Solution:QD =-2000 – 100P + 15A + 25PX + 10I