You have been consulted as a researcher to study the factors affecting the demand for breads among BSC. Economics II students and you have found the demand of bread is function several factors. Thus, you have presented the following demand equation:
๐ธ๐
=๐๐+๐๐๐ท+๐๐๐ท๐+๐๐๐ +๐๐๐จ+๐๐๐ฎ +๐๐๐ท๐ +๐ ๐๐
Where
๐๐ = ๐๐ข๐๐๐ก๐๐ก๐ฆ ๐๐๐๐๐๐๐๐ ๐๐ก ๐ก๐๐๐ ๐ก, ๐1 = ๐ ๐๐๐๐ ๐ก๐๐๐ก, ๐2 โ ๐7 = ๐ก
๐๐๐๐๐๐๐๐๐๐๐ก ๐๐ ๐กh๐ ๐ฃ๐๐๐๐๐๐๐๐ , ๐ = ๐๐๐๐๐ ๐๐ ๐๐๐๐๐, ๐๐ = ๐๐๐๐๐ ๐๐ ๐๐ก๐ ๐๐๐๐๐ก๐๐ ๐๐๐๐, ๐ = ๐๐๐๐๐๐ ๐๐ ๐กh๐ ๐ ๐ก๐ข๐๐๐๐ก, ๐ด = ๐๐๐ ๐๐ ๐ ๐ก๐ข๐๐๐๐ก, ๐บ = ๐๐๐๐๐๐ ๐๐ ๐ ๐ก๐ข๐๐๐๐ก, ๐๐ =
๐๐๐๐๐๐๐ก๐๐๐๐ ๐๐ ๐๐ข๐๐๐๐ก๐ฆ ๐๐ ๐๐๐๐๐ ๐๐ฆ ๐ ๐ก๐ข๐๐๐๐ก ๐๐๐ ๐ข๐ก = ๐๐๐๐๐ ๐ก๐๐๐
a) Mention types of the variables in demand equation
b) Mention the measurement scale of each variable used in the demand equation
a) The variables in the demand equation are:
- ๐๐: Quantity demanded of bread
- ๐: Price of bread
- ๐๐: Price of related good (interpreted as a complement or substitute for bread)
- ๐: Income of the student
- ๐ด: Age of the student
- ๐บ: Gender of the student
- ๐๐: Price expectations of the student
- ๐ข๐ก: Error term
b) The measurement scale of each variable used in the demand equation can vary. Generally, the measurement scales are as follows:
- ๐๐: Interval or ratio scale
- ๐: Ratio scale
- ๐๐: Ratio scale
- ๐: Ratio scale
- ๐ด: Ratio scale (but sometimes ordinal)
- ๐บ: Nominal scale
- ๐๐: Interval or ratio scale
- ๐ข๐ก: No specific measurement scale
a) The types of variables in the demand equation are as follows:
- ๐๐: Quantity demanded of bread (dependent variable)
- ๐: Price of bread
- ๐๐: Price of its related good
- ๐: Income of the student
- ๐ด: Age of the student
- ๐บ: Gender of the student
- ๐๐: Perceptions on quality of bread by students
- ๐ก: Time
b) The measurement scale of each variable used in the demand equation can vary, depending on the specific nature of the data collected. However, here are some possibilities:
- ๐๐: Ratio or interval scale
- ๐: Ordinal or interval scale
- ๐๐: Ordinal or interval scale
- ๐: Ratio or interval scale
- ๐ด: Ordinal or interval scale
- ๐บ: Nominal scale
- ๐๐: Interval or ordinal scale
- ๐ก: Interval or ordinal scale