Garvin Corporation manufactures a drink bottle, model CL24. During 2017, Garvin produced 220,000 bottles at a total cost of $935,000. Beecher Corporation has offered to supply as many bottles as Garvin wants at a cost of $4.15 per bottle. Garvin anticipates needing 236,000 bottles each year for the next few years. Requirements 1. a. What is the average cost of manufacturing a drink bottle in 2017? How does it compare to Beecher's offer? b. Can Garvin use the answer in requirement 1a to determine the cost of manufacturing 236,000 drink bottles? Explain. Garvin's cost analyst uses annual data from past years to estimate the following regression equation with total manufacturing costs of the drink bottle as the dependent variable and drink bottles produced as the independent variable 2. y $430,000+$3.00X During the years used to estimate the regression equation, the production of drink bottles varied from 210,000 to 246,000. Using this equation, estimate how much it would cost Garvin to manufacture 236,000 drink bottles. How much more or less costly is it to manufacture the bottles rather than to acquire them from Beecher? What other information would you need to be confident that the equation in requirement 2 accurately predicts the cost of manufacturing drink bottles? 3. Requirement 1a. What is the average cost of manufacturing a drink bottle in 2017? How does it compare to Beecher's offer? The average cost of S Requirement 1b. Can Garvin use the answer in requirement 1a to determine the cost of manufacturing 236,000 drink bottles? Explain Garvin per bottle is than Beecher's offer. I take the average manufacturing cost in 2017 to determine the total cost of manufacturing 236,000 drink bottles. The reason is that Requirement 2. Garvin's cost analyst uses annual data from past years to estimate the following regression equation with total manufacturing costs of the drink bottle as the dependent variable and drink bottles produced as the independent variable: y-$430,000+ $3.00X. During the years used to estimate the regression equation, the production of drink bottles varied from 210,000 to 246,000. Using this equation, estimate how much it would cost Garvin to manufacture 236,000 drink bottles. How much more or less costly is it to manufacture the bottles rather than to acquire them from Beecher? Estimate how much it would cost Garvin to manufacture 236,000 drink bottles, then calculate the cost to purchase the bottles. Estimated cost to make the bottles $ Cost to purchase the bottles It will cost $ Ito purchase the bottles rather than manufacture them in-house. Requirement 3. What other information would you need to be confident that the equation in requirement 2 urately predicts the cost A. Does the slope of the regression line indicate that a strong relationship exists between manufacturing costs and the number of drink bottles produced? B. Can Garvin's competitors manufacture drink bottles at a cost less than Garvin? C. D. How good is the goodness of fit? That is, how well does the estimated line fit the data? Is the relationship between total manufacturing costs and quantity of drink bottles economically plausible? Garvin Corporation manufactures a drink bottle, model CL24. During 2017, Garvin produced 220,000 bottles at a total cost of $935,000. Beecher Corporation has offered to supply as many bottles as Garvin wants at a cost of $4.15 per bottle. Garvin anticipates needing 236,000 bottles each year for the next few years. Requirements 1. a. What is the average cost of manufacturing a drink bottle in 2017? How does it compare to Beecher's offer? b. Can Garvin use the answer in requirement 1a to determine the cost of manufacturing 236,000 drink bottles? Explain. Garvin's cost analyst uses annual data from past years to estimate the following regression equation with total manufacturing costs of the drink bottle as the dependent variable and drink bottles produced as the independent variable 2. y $430,000+$3.00X During the years used to estimate the regression equation, the production of drink bottles varied from 210,000 to 246,000. Using this equation, estimate how much it would cost Garvin to manufacture 236,000 drink bottles. How much more or less costly is it to manufacture the bottles rather than to acquire them from Beecher? What other information would you need to be confident that the equation in requirement 2 accurately predicts the cost of manufacturing drink bottles? 3. Requirement 1a. What is the average cost of manufacturing a drink bottle in 2017? How does it compare to Beecher's offer? The average cost of S Requirement 1b. Can Garvin use the answer in requirement 1a to determine the cost of manufacturing 236,000 drink bottles? Explain Garvin per bottle is than Beecher's offer. I take the average manufacturing cost in 2017 to determine the total cost of manufacturing 236,000 drink bottles. The reason is that Requirement 2. Garvin's cost analyst uses annual data from past years to estimate the following regression equation with total manufacturing costs of the drink bottle as the dependent variable and drink bottles produced as the independent variable: y-$430,000+ $3.00X. During the years used to estimate the regression equation, the production of drink bottles varied from 210,000 to 246,000. Using this equation, estimate how much it would cost Garvin to manufacture 236,000 drink bottles. How much more or less costly is it to manufacture the bottles rather than to acquire them from Beecher? Estimate how much it would cost Garvin to manufacture 236,000 drink bottles, then calculate the cost to purchase the bottles. Estimated cost to make the bottles $ Cost to purchase the bottles It will cost $ Ito purchase the bottles rather than manufacture them in-house. Requirement 3. What other information would you need to be confident that the equation in requirement 2 urately predicts the cost A. Does the slope of the regression line indicate that a strong relationship exists between manufacturing costs and the number of drink bottles produced? B. Can Garvin's competitors manufacture drink bottles at a cost less than Garvin? C. D. How good is the goodness of fit? That is, how well does the estimated line fit the data? Is the relationship between total manufacturing costs and quantity of drink bottles economically plausible