A logistics company predicts how much freight a depot moves per day from two features:
Five depots make up the training set:
| Depot | Vans | Drivers | Freight (tonnes/day) |
|---|---|---|---|
| A | |||
| B | |||
| C | |||
| D | |||
| E |
The model has no bias term: , and is the design matrix whose columns are and .
The team tries the normal equations , finds they cannot be solved, and switches to ridge regression: choose to minimise
whose closed-form solution is
A new depot has just opened, running vans with drivers.
How much freight does the ridge model predict for it?
Round your answer to two decimal places.
Once you get it right, the reasoning behind the answer shows up here.