Chap 9

Question 1

what is independent variable

Answer 1

X

Question 2

What is dependent variable

Answer 2

Y

Question 3

methods to estimate dependant variable

Answer 3

high low method
linear regression (Y=TC, a=FC b=VCpU X=output)

Question 4

What is high low menthod

Answer 4

for highest and lowest, total cost and output
1) find differences
2) Find VCpU
3) using VCpU find FC
4) TC = FC + VCpU*X

Question 5

what is coreelation coefficient

Answer 5

-r
-1 < r < 1
-strength of relationship between variables

Question 6

What is coefficient of determination

Answer 6

r^2
0< r^2 < 1
proportion of change in y by x

N% of change in total cost is explained by change in output

Question 7

Rank correlation coefficiant

Answer 7

R
-Shows relationship between order of results with another
-1 < R < 1

d = difference in order

Question 8

What are the four components of a time series

Answer 8

Trend - long term movement
Seasonal - short term periodic fluctuations
Cyclical - long term periodic fluctuations - e.g. economu
Random - eg weather

Question 9

How to identify a trend

Answer 9

1) draw a graph
2) moving averages
3) linear regression

Question 10

Moving averages

Answer 10

1. Calculated moving averages
2. Centre moving averages
3. Calculate seasonal impact
4. Average quarterly increase (H-L/no of Q)
5. FInd average season values
6. Forecast