Question

Café Michigan's manager, Gary Stark, suspects that demand for mocha latte coffees depends on the price being charged. Based on historical observations, Gary has gathered the following data, which show the numbers of these coffees sold over six different price values: Price Number Sold $2.70 760 $3.50 510 $2.00 980 $4.20 250 $3.10 320 $4.05 480

Using simple linear regression and given that the price per cup is $ 2.80, the forecasted demand for mocha latte coffees will be ??? cups (enter your response rounded to one decimal place).

Answer 1

Given that, price per cup (x) = $ 2.80

Forecasted demand (y) = 1454.61 - 277.63*2.8 = 677.2