Using Excel, Best Paints estimates the log- linear weekly demand function for their gallon sized paints to be ln Q^d = 16.23 - (1.85 × ln P). At a price of $20, what is the predicted natural logarithm of the quantity (ln Q )? A)0 B)- 20.77 C)10.69 D)43,914.51

Question

Quizplus · Accepted Answer

Substitute P = 20 in the demand function: ln Q^d = 16.23 - (1.85 × ln 20) ln Q^d = 10.69 Therefore, predicted natural logarithm of quantity (ln Q) is 10.69.

Using Excel, Best Paints Estimates the Log- Linear Weekly Demand