Homework: Chapter 6 Homework Part 1 of 5 O Points: 0 of 1 Kathy Rafferty, owner of Flower Power, operates a local chain of floral shops. Each shop has its own delivery van. Instead of charging a flat delivery fee, Rafferty wants to set the delivery fee based on the distance Rafferty wants to separate the fixed and variable portions of her van operating costs so that she has a better idea how delivery distance affects these costs. Flower Power does a regression analysis on the next yea generated by Excel is as follows: (Click the icon to view the regression analysis.) Read the requirements. Requirement 1. Determine the firm's cost equation (use the output from the Excel regression). (Enter amounts to two decimal places.) VE Regression analysis A B E F G 1 SUMMARY OUTPUT 2 Regression Statistics 3 Multiple R 0.87 4 R Square 0.75 0.71 5 Adjusted R Square 6 Standard Error 153.46 7 Observations 7 8 ANOVA 9 df SS MS F Significance F 10 Regression 1 362,391.24 362,391.24 15.39 0.0112 11 Residual 5 117,751.61 23,550.32 12 Total 6 480,142.86 13 Coefficients Standard Error t Stat P-value Lower 95% Upper 95% 14 Intercept 1,784.73 884.55 2.02 0.10 -489.09 4,058.55 15 X Variable 1 0.22 0.06 3.92 0.01 0.07 0.36 Print Done Requirements 1. Determine the firm's cost equation (use the output from the Excel regression). 2. Determine the R-squared (use the output from the Excel regression). What does Flower Power's R-squared indicate? 3. Predict van operating costs at a volume of 15,500 miles assuming the company would use the cost equation from the Excel regression regardless of its R-squared. Should the company rely on this cost estimate? Why or why not? Print Done