The following extract is taken from the sales budget for UHertz Plc: Sales activity 50% 70% Budgeted Production units ￡188,000 E263,200 What is the production budget for a sales activity level of 85% Select the correct answer from the options below E319,600 E456,500 ￡287,400 ￡235,900

## Step1:We are given that at sales activity level, budgeted Production units are and at sales activity level, budgeted production units are . Here we see that the sales activity level and production units are in a linear relationship, i.e., as the sales activity level increases, the production units also increase linearly. ## Step2:To find the production budget for a deal of , wee need to formulate a linear equation using the given pairs of points, and then use the equation to solve for a third. The equation for a straight line is defined as where is the slope and is the constant.### First, calculate the slope (M):### ## Step3: Find the \(Y-)intercept or the constant. Possible use the values of and thus leading to the following equation by substituting back in finding C.### Get,### ## Step4:Substitute and back into the equation and find the budget when the sales activity is at . ### We get,### \(Y = MX + C \iff Y = (3760*85) + C\)