Can you please help me to make up the conclusion over this sweet potatoes study case? Thank you

128 PART Two Demand Analysis CASE STUDY .4'2 \"Ti-"l Using the technique of regression analysis presented in Chapter 5. Schrimper and Mathia estimated the following demand function for sweet potatoes in the United States for the period of 1949 to i972: QB, = 7.609 1.1506195 + saw 4 94?! + 4T9P 2'?\" [4-4] where QB: -quantity of sweet potatoes sold per year in the United States per 1 000 hundred weight (can) P: = realdollar price of sweet potatoes per hundre dweight received by farmers N = two-year moving average of total US. population. in millions l = real per capita personal disposable income. in thousands of dollars P\" = real-dollar price of white potatoes per hundredweight received by farmers t : time trend [1 = 1 for 1949.: = 2 for 1950. up to t = '24 for 19-32) This estimated demand function indicates that the quantity demanded of sweet potatoes per year in LOUDowl tie. in lOD-pound) units in the United States (Q05) declines by 1.606 for each $1 increase in its price (Psi, increases by 59 for each 1 million increase in population (Ni. increases by 947 for each $1.000 increase in real income (i). increases by 479 for each $1 increase in the real price of white potatoes (1\"" .1. but falls by 27] With each passing year (the coefcient of t. the time trend variable). Thus. the demand curve for sweet potatoes is negatively sloped. and it shifts to the right with an increase in population. in income, and in the price of white potatoes, but shifts to the left with each passing year. Since the demand for sweet potatoes increases (i.e.. shifts to the right] with an increase in income. sweet potatoes are a normal good (even though we usually think of potatoes as being an inferior good). Since (20 increases with an increase in P and declines with a reduction In Pr white potatoes are a substitute for sweet potatoes. Finally. the negative coefcient of team be taken to reect the declining tastes for sweet potatoes over time. If we now substitute into Equation 4- 4 the actual \\aluesot'N: l50.'i'3.f=1'i'6.Pw=2.94 such: I for the United States for the year 1949. we get the fol- lowing equation for the U.S. demand curve for sweet potatoes in [949: cos = 7.509 1.6061\": + 59(15033) tumors) + 4790.94) - 211(1) = 7.609 s [noses + 3.393 + l.667+1.403 - 2'i'1 = 19,105 1.60693 [4-51 By then substituting the value of $1" for PI into- Equation 4~S. we get 9135: 3.064. If P5 = $5. 60 (the actual real price of sweet potatoes in the United States in 1949}. QDS=10.312 Finally, if P: : $4. QD: I2. 832. This demand schedule is plotted as D in Figure 4 3. On the other hand. if we substitute into Equation 4-4 the values ofN: 208.73. I: 3.19 P = 2 4], and t: 24 for the year 19\". we get Equation 4-6 for the US. demand curve for sweet potatoes in 19?2; go; = 17.598 1,606.03 [46] By then substituting the same values as above for P into Equation 4 6. we get market demand curve 0' in Figure 4 3 Note that the reduction in tastes for sweet potatoes between 1949 and 19?: and in PW tends to shift D to the left while the increase in N and 1 tends to shift D to the right. Since the rst set offmccs overwhelms the second 0': is to the left of UK. In general it is the average value of the indepen- dent or explanatory variables over the entire period that is substituted into the estimated demand equa- tion to get the equation of the average demand curve for the period (see Problem 2. with the answer at the end of the text). continued cruisers\" Demand Theory 129 6 7 8 9 10 11 12 13 WW\" FIGURE 4-3 The Market Demand Curve for Sweet Potatoes In the United States Ely substituting into Equation 4.5 the values for P: of 5?. $5.60. and $4 and plotting. we get market demand curve 0., for sweet potatoes In the United States for 1949. On the other hand. by substituting thel same values for PS Into Equation 4-6. we get D; as the U.S. demand curve for sweet potatoes in 1902. Since the constant term is smaller For 1972 than for 1949. D; is to the lelt of D... Finally. it must be pointed out that each producer used to estimate the market demandas indieeted in of sweet potatoes shares in the total market demand the previous section. Practically all the available esti- for swat potatoes. Therefore, for a given change in mates of demand. homer; refer to market demand the market price of potatoes or other variable. the because rmsdonot wanttodjsclose their knowledge quantity mponse by a rm will be some fraction of of the man-lest and their strategies and plans to oom- the total market response Furthemme. in order to petitors. An example ofthe demand faced by a first estimate demand sweetly. a producer would have is given in Problem 2 (with the answer at the end of to include explanatory variables in addition to those the text). - Seems: leld A. Schrirnper and Gate A. Mamie. \"Rmmm and Market Demands [or Sweet Rome: the Farm Level." Anselm Journal ongrfcul'tur-rrl Emmi\