Exercise $9(4$pts$)$

Situation:

The oil refinery in Turkey has a processing unit for making lubricating oil $($called lube oil in business$)$

Even though the production of lubricating oil requires

a high capital investment, the profit margin from this product

is higher than normal straight$-$run products such as gasoline, and diesel fuel.

The production manager in the lube oil plant needs

to develop a simple forecasting model for estimating

its blending requirements. lubricating oil, unlike other refinery products, is not very seasonal.

Table $9$ gives the actual lubricating oil blended in a particular year.