1 answer

The following information on maintenance and repair costs and revenues for the last two years is...

Question:

The following information on maintenance and repair costs and revenues for the last two years is available from the accounting records at Arnie’s Arcade & Video Palace. Arnie has asked you to help him understand the relation between business volume and maintenance and repair cost.

Month Maintenance and Repair Cost ($000) Revenues ($000)
July $2.16 $56.00
August 3.13 50.00
September 2.65 46.00
October 2.06 62.00
November 2.15 74.00
December 0.99 102.00
January 2.97 42.00
February 3.01 48.00
March 2.87 58.00
April 2.83 60.00
May 1.89 64.00
June 1.63 76.00
July 2.45 70.00
August 1.87 64.00
September 2.42 72.00
October 2.23 74.00
November 1.28 84.00
December 0.61 114.00
January 2.43 58.00
February 2.13 60.00
March 1.54 80.00
April 1.80 84.00
May 1.80 70.00
June 1.42 66.00

Required:

Using Excel, estimate a linear regression with maintenance and repair cost as the dependent variable and revenue as the independent variable. (Negative amounts should be indicated by a minus sign. Round "Multiple R, R Square and Standard Error" to 7 decimal places, "Intercept and Revenues" to 4 decimal places.)

  
Regression Statistics
Multiple R
R Square
Standard Error
Observations
Coefficients.   
Intercept
Revenues.

Answers

Requirements 1

Regression Statistics
Multiple R 0.86175177
R Square 0.7426161
Adjusted R Square 0.73091685
Standard Error 0.339151996
Observations 24

Requirement 2

Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%
Intercept 4.375712495 0.294313407 14.86753 5.87E-13 3.765344 4.986081 3.765344 4.986081
Revenue -0.033474357 0.004201549 -7.96715 6.32E-08 -0.04219 -0.02476 -0.04219 -0.02476

Additional

ANOVA
df SS MS F Significance F
Regression 1 7.301203659 7.301204 63.47544 6.32E-08
Residual 22 2.530529674 0.115024
Total 23 9.831733333
.

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