The Business School at Eastern College is collecting data as a first step in the preparation of next year's budget. One cost that is being looked at closely is administrative staff as a function of student credit hours. Data on administrative costs and credit hours for the most recent 13 months follow.

Month	Administrative Costs				Credit Hours
July	$	125,343				270
August		85,853				155
September		232,967				1,448
October		221,559				1,028
November		262,229				1,341
December		187,829				1,168
January		223,478				1,627
February		250,238				2,321
March		213,099				1,084
April		195,388				1,163
May		254,119				1,416
June		172,082				600
July		129,900				419
Total	$	2,554,084				14,040
Average	$	196,468				1,080

The controller's office has analyzed the data and given you the results from the regression analysis, as follows.

SUMMARY OUTPUT

Regression Statistics
Multiple R	0.87281564
R Square	0.761807150
Adjusted R Square	0.740153250
Standard Error	27882.77990
Observations	13

ANOVA

	df	SS	MS	F	Significance F
Regression	1	27351500000.00	27351500000.00	35.1800000	0.0000985
Residual	11	8551943556	777449414
Total	12	35903443556.00

	Coefficients	Standard Error	T Stat	P-value	Lower 95%	Upper 95%
Intercept	110850.331	16375.75809	6.76917247	0.0000308	74807.5121	146893.1497
Credit Hours	79.2756195	13.3654979	5.93136300	0.0000985	49.8583422	108.6928968

Required:

a. In the standard regression equation y = a + bx, the letter b is best described as the:

multiple choice 1

• Constant coefficient

• Correlation coefficient

• Dependent variable

• Independent variable

• Variable cost coefficient

b. In the standard regression equation y = a + bx, the letter y is best described as the:

multiple choice 2

• Constant coefficient

• Correlation coefficient

• Dependent variable

• Independent variable

• Variable cost coefficient

c. In the standard regression equation y = a + bx, the letter x is best described as the:

multiple choice 3

• Constant coefficient

• Correlation coefficient

• Dependent variable

• Independent variable

• Variable cost coefficient

d. If the controller uses the high-low method to estimate costs, the cost equation for administrative costs is: (Do not round your intermediate calculations.)

multiple choice 4

• Cost = $74,090 + ($76 Credit hours)

• Cost = $72,590 + ($86 Credit hours)

• Cost = $174,090.00 Credit hours

• Cost = $66

• Some other equation

e. Based on the results of the controller's regression analysis, the estimate of administrative costs in a month with 1,040 credit hours would be: (Round your intermediate calculations to 2 decimals.)

multiple choice 5

• 194,551

• 228,944

• 93,272

• 193,302

• Some other amount

f. The correlation coefficient (rounded) for the regression equation for administrative costs is:

multiple choice 6

• 0.748

• 0.873

• 0.773

• 0.934

• Some other amount

g. The percent of the total variance (rounded) that can be explained by the regression is:

multiple choice 7

• 74.2

• 76.2

• 77.4

• 87.3

• Some other amount