Assume the local Pearle Vision has the following information on the number of sales orders received and order-processing costs.

Month		Sales Orders	Order-Processing Costs
1		3,000	$ 99,240
2		1,500	60,450
3		4,400	144,840
4		2,800	98,280
5		2,300	83,730
6		1,200	51,720
7		2,000	75,000

Required (a.) Use information from the high- and low-volume months to develop a cost-estimating equation for monthly order-processing costs.

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Answer

(b.) Plot the data on a scatter diagram. Using the information from representative high-and low-volume months, develop a cost estimating equation for monthly production costs.

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Answer