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Exercise 5A-5 (Algo) Least-Squares Regression [LO5-11]

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George Caloz & Frres, located in Grenchen, Switzerland, makes luxury custom watches in small lots. One of the companys products, a platinum diving watch, goes through an etching process. The company has recorded etching costs as follows over the last six weeks:

Week	Units	Total Etching Cost
1	5	$ 22
2	7	21
3	10	25
4	5	20
5	16	28
6	17	32
	60	$ 148

For planning purposes, management would like to know the variable etching cost per unit and the total fixed etching cost per week.

Exercise 5A-5 Part 2 (Algo)

2-a. Using the least-squares regression method, estimate the variable etching cost per unit and the total fixed etching cost per week.

2-b. Express these estimates in the form Y = a + bX.