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  3. return price 70 70 75 75 80 80 85 80...

Question: return price 70 70 75 75 80 80 85 80...

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Return Price 70 70 75 75 80 80 85 80 80 80 90 90 95 95 100 100 90 90 85 80 Returns Completed 932 932 910 920 876 852 811 857 847 865 785 802 789 731 663 709 792 831 834Brets Accounting& Tax Services is a small accounting firm in Sioux City, IA which completes taxes for individuals. Every year, firms like Brets decide how much they will charge to complete and file an individual tax return. This price determines how many tax retums fims complete each year. Suppose you are an oflice manager for a firm like Brets Accounting and Tax Services and you are trying to determine what your firm should charge next year for tax retuns. Use the following data to answer these questions a) Graph the data using a scatter plot. Using the Insert Trendline function in Excel, determine whether you should use linear regression or log-linear. Insert the graph below. Be sure to label both axes. We should use regressionb) Using Excels Regression Analysis Function, run a regression and answer the following questions about your output. i) What is your estimated demand function? ii) Discuss the fit and significance of the regression. % of the variation in Retums Completed is explained by our regression using Retum Price. The model statistically significant. How many retums do you expect to be completed if the firms charges $85 per retum? What is the elasticity at this point in the demand curve? Are you on the elastic, inelastic, or unit elastic portion of your demand curve? Can you make a recommendation to increase or decrease price with this information? Price (P) = $85.00 Estimated Retuns Completed (Q) Own Price Elasticity We are on portion of the demand curve. The recommendation is price. d) Suppose the firm has a cost function for individual tax retums of TC- 5000 10Q. Using functions and Excels Solver functionality, determine how much the firms should be charging for a retum to maximize profit and the corresponding total revenue, total cost, and profit. 5000 +10 Q Price (P) Estimated Retums Completed (Q)- Total Revenue (TR)- Total Cost (TC)- Profit

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