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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

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 $ 136,301 1,000
August 96,613 721
September 246,580 1,998
October 244,394 1,606
November 293,263 1,915
December 226,449 1,718
January 268,137 1,945
February 301,000 1,979
March 272,462 1,670
April 261,925 1,729
May 326,978 1,966
June 254,418 1,026
July 219,167 921
Total $ 3,147,687 20,194
Average $ 242,130 1,553

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

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.7985572
R Square 0.637693600
Adjusted R Square 0.604756654
Standard Error 40,005.80589
Observations 13

ANOVA
df SS MS F Significance F
Regression 1 30,986,661,233 30,986,661,233 -19.3610424 0.00106299
Residual 11 17,605,109,557 1,600,464,505.0
Total 12 48,591,770,790

Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%
Intercept 72,045.32692 40,215.47137 1.79148284 0.10073652 -16,468.32876 160,558.9826 -16,468.32876 160,558.9826
X Variable 1 109.4928073 24.88405898 4.400118459 0.00106299 54.72336273 164.262252 54.72336273 164.262252

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

  • 0.735.

  • 0.723.

  • 0.799.

  • 0.833.

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