1 Given the following information determine the equation for

1) Given the following information, determine the equation for the unit formulation. (Round intermediate calculations to 4 decimal places)

[Image Description: Table listing Unit Number (X) and Unit Cost ($Y). Unit 1 = $800, Unit 2 = $568, Unit 3 =$464.88, Unit 4=$403.28]

Possible answers:

Y = (800) (X) -0.4941

Y = (800) (X) 0.9300

Y = (800) (X) -0.1047

Y = (800) (X) 0.6931

Solution

Unit 1 = $800

Unit 2 = $568

Unit 3 =$464.88

Unit 4=$403.28

Step 1: Caluclate the Slope

Slope = Unit2/Unit1 = 568/800 = 0.71, so we know the slope is 71%.

The exponent on X is given by:

ln(0.71)/ln(2) = -0.4941

Y = 800 X^(-0.4941)