If a set of paired data gives the indication that the regression equation is of the form µY|x = α ˆ™ xβ^, it is customary to estimate a and β by fitting the line

To the points {(log xi, logyi); i = 1, 2, . . . , n} by the method of least squares.
(a) Use this technique to fit a power function of the form = ˆ™ xβ^ to the following data on the unit cost of producing certain electronic components and the number of units produced:

(b) Use the result of part (a) to estimate the unit cost for a lot of 300 components.

Transcribed Image Text:

logy : log α + β . log x Lot size Uncst $108 $53 $24 $9 $5 100 250 1,000