CASE 1 – DEMAND ESTIMATION and ELASTICITY: Soft Drinks in the U.S.
Demand can be estimated with experimental data, time-series data, or cross-section
data. In this case, cross-section data appear in the Excel file. Soft drink consumption in
cans per capita per year is related to six-pack price, income per capita, and mean
temperature across the 48 contiguous states in the United States.
1. Given the data, please construct the demand estimation for soft drink consumption in
the United States by
(1) a multiple-linear regression equation, and
(2) a log-linear (exponential) regression equation.
2. Given the MS Excel output in Question 1, please compare the two regression
equations’ coefficient of determination (R-square), F-test and t-test. Which equation
is a good (better) fit? Which equation shows the stronger overall significance to
predict future demand? Which equation will you choose as a better estimation for
quantity demanded? Which equation will you choose as a better estimation for
elasticities? Explain your answer in the language of statistics.
3. Please interpret the coefficient of each independent variable in the multiple-linear soft
drink demand estimated equation.
4. Given the multiple-linear equation, how many cans/capita/year on soft drink should
be for a state in which 6-pack price=$2.99, Income/Capita=$48,500, and Mean
5. Given the log-linear equation, please provide the price elasticity of demand and
income elasticity. Comment on whether the demand is elastic or inelastic and
whether the soft drink is a necessity, normal good or luxury good.
6. Now omit both price and temperature from the regression equation then run the
simple linear regression again. Given the Excel output of only one independent
variable, income, should a marketing plan for soft drinks be designed that relocates
most canned drink vending machines into low-income neighborhood’s? Please
explain your answer in the language of economics.
Distributed: Mon, 20 Aug 2018 Toyota Motor Corporation Profile As per Toyota Global (2015) Toyota is an overall Japanese car partnership headquartered in Aichi, Japan. Toyota was established in August 28 1937 by organizer Kiichiro Toyoda. Showcasing Strategy Fifield (2012) guarantees there are innumerable implications for the term 'Advertising Strategy'. Fifield (2012) collects and gives various implications from different creators for the term 'Advertising Strategy'. However, the most dazzling definition from Fifield's (2012) inquire about was from a creator named Craven. Fifield (2012, p.xxiv) cites Craven's meaning of a showcasing technique in which he characterizes it as "a procedure that includes deliberately investigating ecological, aggressive and also business factors that influence specialty units and estimating future patterns in business regions important to the organization". Entrance Pricing Marketing Strategy A promoting procedure as of now utilized by Toyota is a methodology called infiltration valuing (See Appendix A). Ferrell and Hartline (2010) uncover that the reason for the infiltration valuing promoting methodology is to expand deals and to accomplish far reaching piece of the overall industry inside the market an organization is contending in. Ferrell and Hartline (2010)also expose that the infiltration valuing showcasing procedure has the target of catching a huge piece of the overall industry quickly by setting low costs for items that an organization offers. Besides Ferrell and Hartline (2010) guarantee that entrance evaluating is best executed when customers are delicate towards the cost of the item. Harrison and John (2013) feature Toyota's utilization of the entrance estimating showcasing technique which expresses that Toyota offer their autos in the low end of the value range. This procedure takes into account the value touchy shoppers. What's more Wood (2007) embodies Toyota's utilization of the infiltration evaluating showcasing methodology when Toyota presented their Yaris Subcompact auto creation to the Europe advertise. Wood (2007) features that Toyota's use of the entrance valuing promoting system for their Yaris auto creation empowered the partnership to rival other surely understood car organizations, for example, Ford, Volkswagen, Renault and Vauxhall. Guerrilla Marketing Strategy Another showcasing system utilized by Toyota is an advertising procedure called the guerrilla technique (See Appendix B). Boone and Kurtz (2014) advise that guerrilla advertising includes organizations utilizing unpredictable strategies to draw in customer consideration. Boone and Kurtz (2014) likewise view the guerrilla advertising system as a genuinely new showcasing procedure, moreover Boone and Kurtz (2014) uncover that the methodology is ordinarily utilized by organizations that don't have money related assets for other surely understood or more compelling promoting methodologies. What is more Boone and Kurtz (2014) present that set up organizations, for example, Toyota and Pepsi likewise utilize the guerrilla showcasing procedure despite the fact that such organizations have the money related ability to actualize more powerful promoting methodologies. Boyles (2008) recognizes Toyota's joining of the guerrilla showcasing technique which diagrams that Toyota's fundamental explanation behind utilizing the guerrilla advertising methodology is to draw in the more youthful group i.e. youthful grown-ups. Boyles (2008) additionally calls attention to that organizations, for example, Toyota direct this methodology by setting commercials on items that are utilized ordinary e.g. nourishment or drink bundling. What is more Boyles (2008) goes encourage by uncovering that organizations, for example, Toyota utilize elective strategies for the guerrilla showcasing system, for example, putting commercials in areas where individuals drive every now and again. Internet based life Marketing Strategy A further system presently utilized by Toyota is the web based life promoting methodology (See Appendix C). Promoting by means of utilization of web based life is viewed as a contemporary procedure in the advertising scene and is additionally viewed as an exceptionally successful showcasing system. Numerous organizations in this day age are presently exploiting the internet based life promoting technique, for example, Toyota. Zarrella (2009) advises that online networking advertising includes the utilization of web advances. Zarella (2009) likewise calls attention to that online life web innovations incorporate exercises, for example, blogging, informal communities, (for example, Facebook and LinkedIn) and media sharing locales, (for example, Flickr and YouTube). Tybout and Calde, (2010) present a nitty gritty case of Toyota's use of the web based life showcasing system. Tybout and Calde (2010) represent Toyota's utilization of the internet based life technique promoting by revealing Toyota's association with an organization called iCrossing. Tybout and Calde (2010) go assist by recognizing iCrossing's job in building consciousness of Toyota's IQ city auto which was discharged by Toyota in 2008. Tybout and Calde, (2010) pronounce that iCrossing is a UK based organization who work in computerized advertising. Also Tybout and Calde, (2010) notice that iCrossing advanced Toyota's IQ auto demonstrate through the utilization of a crusade called 'The Hypermiling Campaign'. Hypermiler (2015) is an online network that spotlights on giving fuel sparing exhortation. iCrossing's help with advancing the IQ auto creation helped Toyota to produce positive expectation among the network's online clients. Tybout and Calde, (2010) proceed by discussing Toyota's IQ blogging website which was made particularly for the IQ auto generation. Tybout and Calde, (2010) carry on by revealing Toyota's expansion in rush hour gridlock on their blogging website which expanded by in excess of 212 percent because of their alliance with iCrossing. Tybout and Calde, (2010) address on how the web based life advertising methodology has empowered Toyota to contact new groups of onlookers using elective web based life promoting procedures, for example, blog posting, Flickr and Twitter. Tybout and Calde, (2010) finish up by tending to an extra method utilized by Toyota in the web based life domain which is the joining of their online newsroom with web-based social networking outlets, for example, YouTube, Flickr and Twitter. The aftereffect of this advertising procedure combination has enabled the web network to get to Toyota's pictures, recordings, exercises and whatever else related with Toyota. Public expo Marketing Strategy The last technique utilized by Toyota is public exhibition promoting methodology (See Appendix D). This advertising procedure is utilized by some notable car organizations inside the auto business. Public expo promoting includes organizations displaying their new product(s) or service(s). Söilen (2013) depicts public expo promoting as individual to individual, data trade and offering. Söilen (2013) continues by expressing that exchange demonstrates include the social occasion and dissemination of data. Toyota utilizes this specific technique to show new auto creations. A case of Toyota's expo advertising technique is their joint effort with a German organization called B+s shows. B+s presentations (2015) outline the association between the two organizations where they present exhibitions and in addition video film of Toyota's public exhibitions. Toyota and b+s displays have cooperated since the mid 1980s. B+s presentations are an organization who have been spend significant time in public exhibitions for more than 40 years where one of their essential centers is expo advertising for best car organizations all around the globe. Suggestions to Improve Toyota's Marketing Strategies Infiltration Pricing Marketing Strategy Improvement In light of the discoveries, Toyota could enhance their entrance valuing showcasing methodology by at first offering their autos at a low cost at that point gradually expanding their costs once they have built up a solid demographic on any new generation they discharge. As made reference to before organizations utilize the infiltration methodology to accomplish across the board piece of the overall industry inside the market they are contending in. This means organizations, for example, Toyota utilizing the infiltration estimating technique are attempting to construct a solid demographic which Toyota accomplished many occasions throughout the years with the different auto creations they have discharged. Holden and Burton (2010) address this issue in which they expound on the issues that can emerge from the infiltration estimating system. First Holden and Burton (2010) handle the issue of clients who come to organizations, for example, Toyota dependent on cost where they feature such clients similar to the first to leave once another contender enters the market. What is more Holden and Burton (2010) express that contending with contenders dependent on cost is the minimum maintainable upper hand technique to have. Despite the fact that Toyota has been one of the world's driving car rivals for a long time it is basic to avoid potential risk into thought for the reason that they could at some point or another wind up in such a circumstance. The strategy of beginning off with low cost at that point moderating expanding the cost could help manage the organization's upper hand a long time down the line. Guerrilla Marketing Strategy Improvement Toyota could enhance their guerrilla promoting methodology by coordinating their guerrilla advertising procedure with their web-based social networking showcasing technique. Levinson and Gibson (2010) talk about the viability of joining the two showcasing techniques. Levinson and Gibson (2010) dive into how guerrilla advertising methodology is capable work nearby the web based life promoting technique by noticing the cost part of consolidating the two showcasing methodologies. They uncover that making a web based life stage requires zero expenses. Levinson and Gibson (2010) carry on by talking about that all guerrilla advertisers should exploit this thought as it gives guerrilla advertisers, for example, Toyota the chance to expand their image to a more extensive group of onlookers. Internet based life Marketing Strategy Improvement In view of the discoveries Toyota has just built a soli>GET ANSWER