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# QUESTION 27 *REGRESSION-ESTIMATION AN IMPORTANT APPLICATION OF REGRESSION IN MANUFACTURING IS THE ESTIMATION OF COST OF...

QUESTION 27 *REGRESSION-ESTIMATION

AN IMPORTANT APPLICATION OF REGRESSION IN MANUFACTURING IS THE ESTIMATION OF COST OF PRODUCTION. BASED ON DATA FROM AJAX WIDGETS RELATING COST (Y) TO VOLUME (X), WHAT IS THE COST PER WIDGET?

 Production Volume (units) Total Cost (\$) 400 4688 450 4893 550 5957 600 6105 700 7111 750 7743 425 4983 475 5461 575 6136 625 6302 725 7538 775 7596

#### Homework Answers

Answer #1

Minitab steps to obtain the Cost per Widget:

Step 1. Enter the data of Production Volume (units) and Total Cost (\$) in Minitab columns.

Step 2. Click on Stat>Regression>Regression.

Step 3. Selcet Total Cost (\$) in Response and Production Volume (units) in Predictors.

Step 4. Click OK.

The output is given below:

Therefore, the cost per widget is \$8.2145.

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