I have several (x) variables which all come up to the total cost and in some way tell us what the profit margin (y) should be.
Some of the (x) variables are:
I have about 100 items in my data set and know how to create a model based on multiple regression which will help me predict what the profit margin should be. Problem we have is that we want to know how much margin we can charge for each of the following:
We know run cost will be at 20% margin, and purchase will be at 30%. Problem is that we don’t know what type of margin the other elements should be at given the response of the other x variables. Is there any way I can calculate the result of multiple (y) variables, so I can see what my “subitems” of cost (ie. Run, setup, material, paint, and purchase) cost can be at for margin. Maybe I am way off base with this or maybe I need to know some other factors to determine this. We are trying to determine what the “market will bear” for these items.
Thanks in advance for your help.