1. Details of the regression analysis are as follows:
Fall DRQ # November 3, 2011
Branded Products, Inc., based in San Francisco, CA, is a leading manufacturer of household laundry detergent and bleach products. About a year ago, Branded Products rolled out its new CleanX detergent in 30 regional markets, following its success in test markets. Specifically, you, as an analyst for Branded Products, Inc., estimate a demand model given by:
QCleanX = f(PCleanX, PPG, AD, I), where
Details of the regression analysis are as follows:
QCleanX = number of cases of CleanX
PCleanX = price per case of CleanX
PPG = competitor (Proctor & Gamble)
price per case
AD = amount of advertising expenditures
spent in each regional market
I = average household income in
each regional market
.904
(1pt) (a) Use the regression model estimation results to forecast the demand in Houston, TX, (a new market), where the price per case is $155, the competitor (Proctor & Gamble) price is $90, the amount of advertising expenditures is $790, and the average household income for the Houston, TX, market is $41,234. Show all work.
(1pt) (b) Construct a 95% confidence interval for your forecast in (a). A critical value of the t-distribution is needed to answer this problem. A co-worker suggests either t30, 0.05 = or t25, 0.05 = as the appropriate value. Select the correct value and use this value to construct the appropriate 95% confidence interval for your forecast in (a).

2. ˆ DRQ #9 – November 3, 2011 Dorito’s = 20 + 8t
The trend analysis corresponding to the sales of Dorito’s potato chips yields the following results:
Dorito’s = t
Suppose that this analysis uses monthly observations from June 2008 to October 2011, a total of 41 observations.
(0.5 pts) (a) What is the technical name of this model?
(0.5 pts) (b) According to this model, sales of Dorito’s potato chips increase by ____________ dollars each month.
(1 pt) (c) Provide the forecast for November 2011? ˆ