The following information on maintenance and repair costs and revenues for the l

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 July Maintenance and Repair Cost ($000) $2.51 3.48 3.00 2.41 2.50 1.34 3.32 3.36 3.22 3.18 2.24 1.98 2.80 2.22 2.77 2.58 1.63 0.96 2.78 248 1.89 2.15 2.15 1.21 Revenues ($000) $63.00 57.00 53.00 69.00 81.00 109.00 49.00 55.00 65.00 67.00 71.00 83.00 77.00 71.00 9.00 81.00 91.00 121.00 65.00 67.00 87.00 91.00 7.00 73.00 March April May July March April May 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.) Answer is complete but not entirely correct. Regression Statistics Multiple R R Square Standard Error 0.7910629 0.6257805 0.6087705 24 4.9164 (0.0330)

Explanation / Answer

Solution:

Regression Statistics:

Multiple R 0.8852219

R Square 0.7836178

Standard Error 0.3041103

Observations 24

Coefficients:

Coefficients Intercept 3.9044

Revenues -0.0336

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