Refer to Problem 21. The cost data can be transformed by taking the natural logarithms of both estimated costs and actual costs. Consider a simple linear regression model for the transformed costs. A portion of the Minitab output for this analysis is shown below.
The regression equation is
LnActual = 0.003 + 0.968 LnEstimate

a. Is this regression significant? Explain.
b. Identify and interpret r2.
c. Are the sample data consistent with the population values β0 = 0 and β1 = 1? Explain. What is the significance of these particular choices for B0 and B1?
d. Construct a forecast of actual cost when estimated cost is $24 million.

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Predictor Constant LnEstimate 0.96811 0.06583 14.71 0.000 Coef SE Coef 0.0026 0.1625 0.02 0.987 S= 0.412124 R-Sq= 90.0% R-Sq(adj) 89.6%