According to CNN, two dairy farmers challenged the legality of the funding of the “ Got Milk?” campaigns. They argued that the “Got Milk?” campaigns do little to support milk from cows that are not injected with hormones and other sustainable agriculture products, and therefore violate their (and other farmers’) First Amendment rights. The 3rd U. S. Circuit Court of Appeals agreed and concluded that dairy farmers cannot be required to pay to fund the advertising campaigns. One of the obvious backlashes to the National Dairy Promotion and Research Board is reduced funding for advertising campaigns. To assess the likely impact on milk consumption, suppose that the National Dairy Promotion and Research Board collected data on the number of gallons of milk households consumed weekly (in millions), weekly price per gallon, and weekly expenditures on milk advertising (in hundreds of dollars). These data, in forms to estimate both a linear model and log- linear model, are avail-able online at www.mhhe.com/ baye8e in a file named Q20.xls. Use these data to perform two regressions: a linear regression and a log- linear regression. Compare and contrast the regression output of the two models. Comment on which model does a better job fitting the data. Suppose that the weekly price of milk is $ 3.40 per gallon and the National Dairy Promotion and Research Board’s weekly advertising expenditures fall 35 percent after the court’s ruling to $ 150 (in hundreds). Use the best- fitting regression model to estimate the weekly quantity of milk consumed after the court’s ruling.
Answer to relevant QuestionsA consumer has $ 300 to spend on goods X and Y. The market prices of these two goods are Px = $ 15 and Py = $ 5. a. What is the market rate of substitution between goods X and Y? b. Illustrate the consumer’s opportunity ...The U. S. government spends over $33 billion on its Food Stamp program to pro-vide millions of Americans with the means to purchase food. These stamps are redeemable for food at over 160,000 store locations throughout the ...An economist estimated that the cost function of a single- product firm isC (Q) = 100 + 20Q + 15Q2+10Q3Based on this information, determine: a. The fixed cost of producing 10 units of output. b. The variable cost of ...According to The Wall Street Journal, Mitsubishi Motors recently announced a major restructuring plan in an attempt to reverse declining global sales. Sup-pose that as part of the restructuring plan Mitsubishi conducts an ...Suppose the own price elasticity of market demand for retail gasoline is 0.8, the Rothschild index is 0.5, and a typical gasoline retailer enjoys sales of $ 1.5 million annually. What is the price elasticity of demand for a ...
Post your question