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A mail-order catalog business maintains a centralized warehouse. Management is currently examining the factors that affect warehouse distribution costs. The data provided indicate the warehouse

A mail-order catalog business maintains a centralized warehouse. Management is currently examining the factors that affect warehouse distribution costs. The data provided indicate the warehouse distribution costs (in thousands of dollars), the sales, X1 (in thousands of dollars), and the number of orders received, X2, for each of the past 24 months.

Costs

Sales

Orders

52.03

387

4,007

71.77

446

3,783

85.96

511

5,283

63.42

401

4,294

72.39

458

4,287

68.53

458

4,112

52.98

302

3,207

70.24

481

4,772

81.85

514

5,272

74.45

506

4,765

70.15

533

4,445

54.72

351

2,941

62.26

373

4,009

72.91

327

4,421

58.16

405

3,972

79.78

487

4,595

94.32

529

5,542

59.05

443

3,422

90.07

622

5,088

93.64

601

5,694

69.32

465

4,236

53.67

388

3,689

89.88

549

5,394

66.74

414

4,138

A. Determine the VIF for each independent variable in the model, with VIF1 and VIF2 being the VIF for X1 and X2, respectively.

VIF1=?

VIF2=?

B. Is there reason to suspect the existence of collinearity?

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