The president of a small manufacturing firm is concerned about the continual increase in manufacturing costs over the past several years. The table below provides a time series of the cost per unit for the firm's leading product over the past eight years.

Year	Quarter	Cost/Unit ($)	Year	Quarter	Cost/Unit ($)
1	1	19.59	5	1	28.46
	2	17.24		2	32.68
	3	13.71		3	28.58
	4	17.89		4	24.92
2	1	20.29	6	1	25.88
	2	25.67		2	35.44
	3	22.25		3	27.36
	4	30.10		4	27.85
3	1	24.02	7	1	28.33
	2	20.73		2	28.59
	3	26.40		3	32.31
	4	25.06		4	28.21
4	1	20.67	8	1	37.63
	2	28.89		2	28.80
	3	32.93		3	37.21
	4	25.59		4	38.13

Question 1.

Use simple linear regression analysis to find the parameters for the line that minimizes MSE for this time series. If required, round your answers for the parameters to four decimal places and your answer for the MSE to three decimal places. Do not round your intermediate calculations.

y-intercept,b₀=

Slope,b₁=

MSE =

Question 2.

What is the average cost increase that the firm has been realizing per year? If required, round your answer to two decimal places.

Question 3.

Compute an estimate of the cost/unit for the next quarter. If required, round your answer to two decimal places. Do not round your intermediate calculations.