Question
The executive vice-president of a drug manufacturing firm believes that the demand for the firm's most popular drug has been evidencing an exponential trend since
The executive vice-president of a drug manufacturing firm believes that the demand for the firm's most popular drug has been evidencing an exponential trend since 2002. He uses Microsoft Excel to obtain the output below. The dependent variable is the log base 10 of the demand for the drug, while the independent variable is years, where 2002 is coded as 1, 2003 is coded as 2, etc.
Model is given by: Log10 (Demandt) =0 +1 (periodt) + et
SUMMARY OUTPUT | ||||
Regression Statistics | ||||
Multiple R | 0.937 | |||
R Square | 0.877 | |||
Adjusted R Square | 0.869 | |||
Standard Error | 0.129 | |||
Observations | 17 | |||
ANOVA | ||||
df | SS | MS | F | |
Regression | 1 | 1.799 | 1.799 | 107.369 |
Residual | 15 | 0.251 | 0.017 | |
Total | 16 | 2.051 | ||
Coefficients | Standard Error | t Stat | P-value | |
Intercept | 4.0666 | 0.0659 | 61.7028 | 0.0000 |
Period | 0.0672 | 0.0065 | 10.3619 | 0.0000 |
Calculate the forecast for demand in 2020. Answer to 4 decimal places.
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