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Question

Lexon Inc. is a large manufacturer of affordable DVD players. Management recently became aware of rising expenses

resulting from returns of malfunctioning products. As a starting point for further analysis, Paige Jennings, the controller, wants to test different forecasting methods and then use the best one to forecast quarterly expenses for 2019. The relevant quarterly data for the previous three years follow:

 

2016 Quarter Return Expenses 2017 Quarter Return Expenses 2018 Quarter Return Expenses

1 $13,800  1 $14,200  1 $14,600 

2  12,500  2  13,300  2  13,500 

3  12,800  3  12,900  3  13,300 

4  15,100  4  15,400  4  16,000 

 

The result of a simple regression analysis using all 12 data points yielded an intercept of $13,109.09 and a coefficient for the independent variable of $129.37. (R-squared = 0.17, SE = $1,063.80.)


Required:

1. Plot the data in the order of the dates. (To earn full credit for this graph you must plot all required points for each curve. While plotting the points a tool icon will pop up. You can use this to enter exact co-ordinates for your points as needed.)

 

Return Expenses

17000

16000

15000

14000

13000

12000

11000

10000

9000

8000

7000

6000

0 2 4 6 8 10 12 14

Quarter

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