Thane Company is interested in establishing the relationship between electricity

Question

Thane Company is interested in establishing the relationship between electricity costs and machine hours. Data have been collected and a regression analysis prepared using Excel. The monthly data and the regression output follow:
  

  

The percent of the total variance that can be explained by the regression is:

Month Machine Hours Electricity Costs January 2,800 $ 19,350 February 3,200 $ 22,900 March 2,200 $ 14,450 April 3,400 $ 24,900 May 4,100 $ 29,200 June 3,600 $ 23,900 July 4,400 $ 25,700 August 3,800 $ 23,700 September 2,300 $ 17,400 October 4,000 $ 27,900 November 5,200 $ 32,900 December 4,900 $ 28,700

Explanation / Answer

The percent of the total variance that can be explained by the regression is coefficient of determination which is R square . So from above table R square is 0.893 means 89.3% of variation can be explained by regression. It also indicates that the model explains 89.3% of the variability of the response data around its mean.

Regression equation line: y= 5.27x+4979.52

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