The College of Business at Northeast College is accumulating data as a first step in the preparation of next year's budget development. One cost that is being looked at closely is administrative costs as a function of student credit hours. Data on administrative costs and credit hours for the past thirteen months are shown below:

Month	Administrative Costs				Credit Hours
July		$	130,301		1,250
August			83,413		635
September			226,180		1,912
October			216,794		1,520
November			258,463		1,829
December			185,449		1,632
January			219,937		1,859
February			245,600		1,893
March			209,862		1,584
April			192,125		1,643
May			250,978		1,880
June			171,218		940
July			128,767		835
Total		$	2,519,087		19,412
Average		$	193,776		1,493

The controller's office has analyzed the data and has given you the results from the regression analysis:

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.9085201
R Square	0.825408732
Adjusted R Square	0.809536799
Standard Error	23,121.17056
Observations	13

ANOVA
	df	SS	MS	F	Significance F
Regression	1	27,800,900,364	27,800,900,364	-52.0042966	1.72718E-05
Residual	11	5,880,473,811	534,588,528.2
Total	12	33,681,374,175

	Coefficients	Standard Error	t Stat	P-value	Lower 95%	Upper 95%	Lower 95.0%	Upper 95.0%
Intercept	30,209.74624	23,570.69478	1.28166550	0.226316412	-21,669.00318	82,088.4957	-21,669.00318	82,088.4957
X Variable 1	109.5384452	15.18962175	7.211400458	1.72718E-05	76.10631318	142.970577	76.10631318	142.970577

The correlation coefficient (rounded to the 3^rd decimal) for the regression equation for administrative costs is:

Multiple Choice

• 0.909.

• 0.845.

• 0.833.

• 0.943.

The College of Business at Northeast College is accumulating data as a first step in the preparation of next year's budget development. One cost that is being looked at closely is administrative costs as a function of student credit hours. Data on administrative costs and credit hours for the past thirteen months are shown below:

Month	Administrative Costs				Credit Hours
July		$	130,051		1,000
August			83,213		505
September			226,030		1,782
October			216,694		1,390
November			258,413		1,699
December			185,199		1,502
January			219,737		1,729
February			245,450		1,763
March			209,762		1,454
April			192,075		1,513
May			250,728		1,750
June			171,018		810
July			128,617		705
Total		$	2,516,987		17,602
Average		$	193,614		1,354

The controller's office has analyzed the data and has given you the results from the regression analysis:

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.9215426
R Square	0.849240681
Adjusted R Square	0.835535288
Standard Error	21,494.88332
Observations	13

ANOVA
	df	SS	MS	F	Significance F
Regression	1	28,629,218,422	28,629,218,422	-61.9639804	7.61493E-06
Residual	11	5,082,330,099	462,030,009.0
Total	12	33,711,548,521

	Coefficients	Standard Error	t Stat	P-value	Lower 95%	Upper 95%	Lower 95.0%	Upper 95.0%
Intercept	45,381.11216	19,752.25742	2.29751523	0.042216052	1,906.68670	88,855.5376	1,906.68670	88,855.5376
X Variable 1	109.4780446	13.90776610	7.871720295	7.61493E-06	78.86725786	140.088831	78.86725786	140.088831

If the controller uses regression analysis to estimate costs, the estimate of the variable portion of administrative costs is:

Multiple Choice

• Variable Costs = $15.06 Credit hours.

• Variable Costs = $7.30 Credit hours.

• Variable Costs = $109.48 Credit hours.

• Variable Costs = $18.42 Credit hours.