Columbus Airlines introduced a new, specially discounted line of air fares in 1995. Annual ticket revenues Y (in $ 1,000s) are shown in the following table, along with the time period X (in months, with X = 1 for January 1995).
Month Ticket Revenues
1 ………………………… 34.9
2 ………………………… 38.8
3 ………………………… 41.5
4 ………………………… 45.1
5 ………………………… 48.3
6 ………………………… 51.2
7 ………………………… 56.6
8 ………………………… 59.9
9 ………………………… 65.4
Use the accompanying computer output to answer the following questions.
a. Determine the estimated equation for the straight-line regression of ticket revenues (Y) on month (X).
b. Determine the estimated equation for the quadratic regression of ticket revenues (Y) on month (X).
c. Plot both estimated models, along with a scatterplot of the data. Which model appears to fit the data better?
d. Conduct variables-added-in-order tests for the model in part (b).
e. Carry out tests for the significance of the straight-line regression in part (a).
f. Carry out tests for the significance of the quadratic regression in part (b).
g. Examine the variance inflation factors for the estimated model in part (b). Does there appear to be a problem with collinearity?
h. Based on the results from parts (a) through (g), which of the two regression models appears to be more appropriate for predicting ticket revenues?