EXERCISE #3: VOLUME CHEMICAL
You are involved in analyzing the relationship between the cost and the volume
of production. You have collected the following inflation‐adjusted data:
Table 3.12—Volume Chemical Inflation-Adjusted Data
Production Units Costs
700 $61,750
1,450 $64,450
1,500 $66,000
1,750 $69,438
2,100 $73,410
2,150 $75,720
3,050 $79,375
1. Estimate the cost to produce 2,000 units.
2. Determine the coefficient of determination (r2).
3. Determine whether to use this equation for estimating purposes. (yes/no)
