Jorgenson Corporation has provided the following data for the first five months of the year: Using the least-squares regression method of analysis, the estimated variable lubrication cost per machine hour is closest to:
A) $0.80
B) $1.56
C) $1.40
D) $1.28

Question

Jorgenson Corporation has provided the following data for the first five months of the year:  Using the least-squares regression method of analysis, the estimated variable lubrication cost per machine hour is closest to:
A) $0.80 
B) $1.56 
C) $1.40 
D) $1.28

Quizplus · Accepted Answer

The regression line is Y = 1,121.18 + 1.5588X and the R² is 0.9607. Therefore, the variable cost per machine hour for lubrication is closest to $1.56.

Jorgenson Corporation Has Provided the Following Data for the First