Question

Your boss would like you to estimate the fixed and variable components of a particular cost....

Your boss would like you to estimate the fixed and variable components of a particular cost. Actual data for this cost over four recent periods appear below.

Activity Cost
Period 1 41 $ 405
Period 2 40 $ 394
Period 3 37 $ 376
Period 4 42 $ 420

Using the least-squares regression method, what is the cost formula for this cost?

Multiple Choice

  • Y = $56.56 + $8.70X

  • Y = $0.00 + $15.51X

  • Y = $64.46 + $8.36X

  • Y = $69.89 + $5.60X

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