Question

System Number	Basic Tier Subscribers	Basic Tier Price	Per Capita Income	Pay Tier Price		Q3 (10 points)
1	3300	18	3900	22		A. Estimate a basic cable demand using a simple regression model, Q=a+bP+e.
2	6600	10	5560	10		B. Estimate a basic cable demand using a multiple regression model, Q=a+b*PRICE+c*INCOME+d*PayTierPRICE+e.
3	3900	18	8900	18
4	5000	14	8200	16
5	5100	15	7950	10
6	6900	9	6500	7
7	6400	12	5900	8
8	5900	13	7500	15
9	5800	12	7864	12
10	4800	18	4500	12

Answer 1

A) the regression result is as under

the regression model will be Q = 9970.07 - 330.94 P + e

B) the multiple regression result is as below

the regression result will be Q= 9930.98 - 229.99P - 0.01 income - 99.46 pay tier price + e