Question
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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