The following table is for utility costs and units produced in a factory for the last twelve quarters.
|
Cost |
Units |
|
|
|
| 1 |
|
160,660 |
17,000 |
|
|
|
| 2 |
|
202,600 |
19,500 |
|
|
|
| 3 |
|
163,030 |
15,900 |
|
|
|
| 4 |
|
219,500 |
21,300 |
|
|
|
| 5 |
|
169,320 |
17,900 |
|
|
|
| 6 |
|
171,430 |
18,400 |
|
|
|
| 7 |
|
213,050 |
22,000 |
|
|
|
| 8 |
|
191,500 |
18,700 |
|
|
|
| 9 |
|
169,540 |
16,700 |
|
|
|
| 10 |
|
161,530 |
16,400 |
|
|
|
| 11 |
|
187,270 |
18,300 |
|
|
|
| 12 |
|
177,830 |
17,300 |
|
|
|
|
|
|
a) Using the high/low method, develop an equation for utility costs in the form Y = a +bX
b) Using your answer to a), predict utility costs at a volume of 20,000 units.