For a period of three years a company monitors the number of units of output produced per quarter and the total cost of producing the units. The table below shows their results. Units of output Total cost (x) 1000's (y) 1000 14 35 29 50 55 73 74 93 11 31 23 42 47 65 69 86 18 38 36 54 61 81 79 96

(Use Ex-28 740; Exy-38 286)

(a) Draw a scatter diagram of these data.

(b) Calculate the equation of the regression line of y on x and draw this line on your scatter diagram The selling price of each unit of output is 1.60.

(c) Use your graph to estimate the level of output at which the total income and total costs are equal.

(d) Give a brief interpretation of this value. (AEB)