Answer to Question #74273 in Microeconomics for Zulfiqar Ali

Question

The vice president of United Feeds Ltd has provided the following quarterly price-quantity data for UF Superb, a horse feed additive. He has asked that the demand equation for this product be estimated

Price 60 53 43 40 47 57 41 53 37 51
Quantity 83 93 100 108 97 80 105 86 110 90

a) Use the ordinary least square regression method to estimate this function.
b) The firm is considering a price increase to Rs. 66. Make a 95 percent confidence interval estimate of sales volume if this price increase is carried out.