Home / Questions / Least-Squares Regression One of Varic Company’s products goes through a glazing process T...
Least-Squares Regression
One of Varic Company’s products goes through a glazing process. The company has observed glazing costs as follows over the last six weeks:
1 . . . . . . . . . . |
8 |
$270 |
2 . . . . . . . . . . |
5 |
$200 |
3 . . . . . . . . . . |
10 |
$310 |
4 . . . . . . . . . . |
4 |
$190 |
5 . . . . . . . . . . |
6 |
$240 |
6 . . . . . . . . . . |
9 |
$290 |
For planning purposes, the company’s management wants to know the amount of variable glazing cost per unit and the total fixed glazing cost per week.
Required:
1. Using the least-squares regression method, estimate the variable and fixed elements of the glazing cost.
2. Express the cost data in (1) above in the form Y = a + bX.
3. If the company processes seven units next week, what would be the expected total glazing cost?
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