Assignment of Quantative Applications in Management

Assignment

Of

Quantative Applications in Management

Question 1.

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Standard deviation of x (σx) = [Σ(x - a)2 / N ]1/2

                               = [93750 / 6 ]1/2

                               = [15625]1/2

                               = 125

Standard deviation of x (σy) = [Σ(y - b)2 / N ]1/2

                               = [5648336 / 6 ]1/2

                               = [941389.333]1/2

                               = 970.25

a) Regression Equation

        y = 1246 + 7.6 x

b) Variable cost per unit = ______Total Cost________

                            Total no. of units produced

                        =  33700

                             3450

                        =  9.76

c) Coefficient of Determination

        R2 = { 1/N [Σ(x - a)(y - b)] / [σx σy] }2

             =  { 1/6 [712500] / [σx σy] }2

             =  { 1/6 [712500] / [(125)(970.25)] }2

             =  { 1/6 [5.87477] }2

             =  { 1/6 [5.87477] }2

             =  {0.9791}2

             =  0.9586

d) Estimated total cost for operation at 500 units of production

        y = 1246 + 7.6 x

where x = 500

        y = 1246 + 7.6 (500)

           = 1246 + 3800

           = 5046

Question 2.

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