Consider a company that produces a single product. For each of the past 16 months, the company has kept track of the number of units produced as well as the total cost of production. These data appear...

Consider a company that produces a single product. For each of the past 16 months, the company has kept track of the number of units produced as well as the total cost of production. These data appear in Figure 16.8 and in the file Cost Regression 1.xlsx. What can simple regression tell us about the relationship between these two variables? How can it be used to predict future production costs?

Objective To use simple regression to estimate the relationship between Units Produced and Total Cost, and to use this relationship to predict future total costs.