Assignment on Managerial Economics in Organization
Added on - 21 Apr 2020
Running Head: MANAGERIAL ECONOMICS 1MANAGERIAL ECONOMICSStudents NameUniversity of Affiliation
MANAGERIAL ECONOMICS21.Plot a scatter diagram ofTVCon the vertical axis andQon the horizontal axis.Does the scatter diagram suggest a functional form forTVC? Explain briefly.020040060080010001200140016001800010000200003000040000500006000070000f(x) = 41.12 x − 4312.18R² = 0.98TVS vs QUANTITYTVS vs QUANTITYLinear (TVS vs QUANTITY)
MANAGERIAL ECONOMICS3The diagram represents a scatter diagram explaining the relationship between the independentvariable (production unit per month) and the dependent variable (total variable cost).The quantityof production per month illustrates the behavior of the variable cost per month. The form that thedata takes is a cluster form of relationship. Data clusters are observed in the diagram, and astraight line can be drawn with very few points. The graphs represent a weaker strength ofcorrelation between the explanatory and the responsive variables. That means for a particularmonth; one cannot predict the total variable cost based on the production unit of the finishedproduct. The direction of the diagram is drifting upwards displaying a positive relationship.The functional form is y=41.122x-4312.22.Plot a scatter diagram ofAVCon the vertical axis andQon the horizontal axis.Does the scatter diagram suggest a functional form forAVC? Explain briefly020040060080010001200140016001800051015202530354045f(x) = 0.01 x + 28.4R² = 0.67AVC vs QUANTITYThe scatter diagram suggest a functional form of y=0.007x+28.398.
MANAGERIAL ECONOMICS4The graph represents the relationship between the quantity (independent variable) and theaverage variable cost (dependent variable).The figure seeks to explain the correlationbetween the units of finished product produced per month and the average variable price.What impact does quantity produced have on average variable cost? The graph displays acluster form. The Linear line can be drawn on very few points leaving out the majority ofthe points. The direction of the graph is drifting upwards showing a positive correlation.The graph shows a weaker relationship. That is the quantity produced per month cannotpredict the average variable cost. There are outliners in the graph .for example; theamount produced on December had highest average variable cost unlike the increase inquantity produced in July which had low average variable cost.b.Estimate a quadraticAVCfunction.Present the estimated equation and evaluate the regression results (i.e., discussthe algebraic signs of the parameter estimates, the significance levels, and theR2).Quadratic AVC function(x=369=0) (x=330)(x+369)(x+330)=0X²+330x+369x+121770X²+699x+121770=0=x²+699x+121770AVC=Q²+699Q+121770