# Image transcription text 4. Your company, which specializes in bovine costumery (BullFeathers®), has the following demand function: Q=a+bP+cM+dR where Q is the quantity demanded of

Image transcription text 4. Your company, which specializes in bovine costumery (BullFeathers®), has the following demand

function: Q=a+bP+cM+dR where Q is the quantity demanded of BullFeathers’ most popular bird costume for cows, P is the

price of that product, M is consumer income, and R is the price of a related product. The regression

results are: Adjusted R Square 0.8105 Coefﬁcient Standard

Independent Variables 5 Error t Stat P-value

Intercept 9823.57 90.93 108.03 1.37E—42

P -4.859 2.096 -2.319 0-027

M 0.006 0.002 3.844 0-001

R 5.21 1.167 4.463 0-000 a. Discuss whether you think these regression results will generate good sales estimates for BullFeathers. Now assume that the income is $55,613, the price of the related good is $237, and BullFeathers chooses to set

the price of its product at $252. b. What is the estimated number of units sold given the data above? (round to nearest unit; no decimals)

c. What are the values for the own-price, income, and cross-price elasticities? d. If P increases by 5%, what would happen (in percentage terms) to quantity demanded? e. If M increases by 3%, what would happen (in percentage terms) to quantity demanded? f. If R decreases by 4%, what would happen (in percentage terms) to quantity demanded? you in advance

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