Jensen Tire & Auto is in the process of 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).

Weekly Usage

(hours)Annual

Maintenance

Expense1317.01022.02030.02837.03247.01730.52432.53139.04051.53840.0(a)

Develop the estimated regression equation that could be used to predict the annual maintenance expense (in hundreds of dollars) given the weekly usage (in hours). (Round your numerical values to two decimal places.)

=0.95x+10.53

(b)

Test the significance of the relationship in part (a) at a 0.05 level of significance. (Use theFtest.)

State the null and alternative hypotheses.

H₀:₁0

H_a:₁= 0

H₀:₁0

H_a:₁< 0

H₀:₀= 0

H_a:₀0

H₀:₁= 0

H_a:₁0

H₀:₀0

H_a:₀= 0

Find the value of the test statistic. (Round your answer to two decimal places.)

Find thep-value. (Round your answer to three decimal places.)

p-value =

State your conclusion.

Do not rejectH₀. We cannot conclude that the relationship between weekly usage (hours) and annual maintenance expense (in hundreds of dollars) is significant.

RejectH₀. We conclude that the relationship between weekly usage (hours) and annual maintenance expense (in hundreds of dollars) is significant.

RejectH₀. We cannot conclude that the relationship between weekly usage (hours) and annual maintenance expense (in hundreds of dollars) is significant.

Do not rejectH₀. We conclude that the relationship between weekly usage (hours) and annual maintenance expense (in hundreds of dollars) is significant.

(c)

Jensen expects to use the new machine33hours per week. Develop a 95% prediction interval for the company's annual maintenance expense (in hundreds of dollars). (Round your answers to two decimal places.)

$hundred to $hundred

(d)

If the maintenance contract costs $3,300per year, would you recommend purchasing it? Why or why not? (Round your answer to two decimal places.)

The expected expense of a machine being used33hours per week is $hundred. Since this expected expense is

---Select---

greater

less

than the cost of the maintenance contract, the maintenance contract

---Select---

is not

is

advisable.