1. [-11 Points] DATAIe: Jensen CAM M BA4 7.E.003. Weekly Usage "33:02:\": (hours) Expense 13 17.0 10 22.0 20 30.0 28 37.0 32 47.0 17 30.5 24 32.5 31 39.0 40 51.5 38 40.0 '7: O The scatter chart indicates there may be a positive linear relationship between weekly usage and annual maintenance expense. 0 The scatter chart indicates there may be a negative linear relationship between weekly usage and annual maintenance expense. ASK YOUR TEACHER PRACTICE ANOTHER Jensen Tire & Auto is deciding whether to purchase a maintenance contract for its new computer wheel alignment and balancing machine. Managers feel that maintenance expense should be related to usage, and they collected the following information on weekly usage (hours) and annual maintenance expense (in hundreds of dollars). (a) Develop a scatter chart with weekly usage hours as the independent variable. What does the scatter chart indicate about the relationship between weekly usage and annual maintenance expense (in hundreds of dollars)? 0 The scatter chart indicates there may be no noticeable linear relationship between weekly usage and annual maintenance expense. (b) Use the data to develop an estimated regression equation that could be used to predict the annual maintenance expense in hundreds of dollars (y) for a given number of hours of weekly usage (x). What is the estimated regression model? (Round your numerical values to four decimal places.) (c) Test whether the regression parameter u is equal to zero at a 0.05 level of signicance. Find the p-value. (Round your answer to four decimal places.) p-value = State your conclusion. 0 We reject HO' We cannot conclude that the y-intercept is not equal to zero. 0 We fail to reject HO' We cannot conclude that the y-intercept is not equal to zero. 0 We fail to reject HO' We can conclude that the y-intercept is not equal to zero. 0 We reject H0. We can conclude that the y-intercept is not equal to zero. Test whether the regression parameter 51 is equal to zero at a 0.05 level of signicance. (Use the t test.) Find the pvalue. (Round your answer to four decimal places.) p-value = State your conclusion. Q We reject H0. We can conclude that there is a relationship between weekly usage and annual maintenance expense. 0 We reject HO' We cannot conclude that there is a relationship between weekly usage and annual maintenance expense. 0 We fail to reject Ho- We cannot conclude that there is a relationship between weekly usage and annual maintenance expense. 0 We fail to reject Ho. We can conclude that there is a relationship between weekly usage and annual maintenance expense. What are the correct interpretations of the estimated regression parameters? 0 '70 is our estimate of the annual mantenance expense if the weekly usage is zero. #1 is our estimate of the change in annual maitenance expense for a one hour increase in weekly usage. 0 [30 is our estimate of the change in annual maitenance expense for a one hour increase in weekly usage. 121 is our estimate of the annual mantenance expense if the weekly usage is zero. 0 190 is our estimate of the weekly usage if the annual maintenance expense is zero. 1'1 is our estimate of the change in weekly usage for a one hundred dollar increase in annual maintenance expense. O 190 is our estimate of the change in weekly usage for a one hundred dollar increase in annual maintenance expense. 111 is our estimate of the weekly usage if the annual maintenance expense is zero. Are these interpretations reasonable? The interpretation of [10 ---Select v reasonable and the interpretation of [31 ---Select-- v reasonable. (d) How much of the variation in the sample values of annual maintenance expense (in %) does the model you estimated in part (b) explain? (Round your answer to one decimal place.) (a) % The mean weekly usage in our sample is 25.3 hours per week. The expected expense of a machine being used 25.3 hours per week is $ ---Select- v than the cost of the maintenance contract, the maintenance contract ---Select v advisable. If the maintenance contract costs $3,000 per year, would you recommend purchasing it? Why or why not? (Round your answers to two decimal places.) hundred. Since this expected expense is
