Exhibit 16-7

question 38

Short Answer

Exhibit 16-7.It is believed that the sales volume of one liter Pepsi bottles depends on the price of the bottle and the price of one liter bottle of Coca Cola.The following data has been collected for a certain sales region. Using Excel's regression,the linear model PepsiSales = β₀ + β₁PepsiPrice + β₂ColaPrice + ε and the log-log model ln(PepsiSales)= β₀ + β₁ln(PepsiPrice)+ β₂ln(ColaPrice)+ ε have been estimated as follows: Refer to Exhibit 16.7.Using the estimated linear model,calculate the predicted sales of Pepsi when the Pepsi price is $1.50 and the Cola price is $1.25.

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Definitions:

Surgical Excision

The process of removing tissue or an organ from the body through surgical means, typically to treat a disease or condition.

Inflammation

A localized physical condition in which part of the body becomes reddened, swollen, hot, and often painful, especially as a reaction to injury or infection.

Buccal

Relating to the cheek or the mouth cavity.

Cheilosis

A condition that causes inflammation and cracking of the lips, often due to a deficiency of riboflavin (vitamin B2).