The manager of the main laboratory facility at CenterHealth Center is interested in being able to predict the overhead costs each month for the lab. The manager believes that total overhead varies with the number of lab tests performed but that some costs remain the same each month regardless of the number of lab tests performed.

After running a regression analysis on the first seven months of the year, the manager of the main laboratory facility at CenterHealth Center collects seven additional months of data. The number of tests performed and the total monthly overhead costs for the lab follow:

Regression analysis

Month	Number of Lab Tests Performed	Total Laboratory Overhead
August. . . . . . .	3,600	$25,600
September. . . .	3,950	$27,700
October. . . . . .	4,600	$29,450
November. . . .	4,250	$28,100
December. . . .	4,300	$29,000
January. . . . . .	2,200	$20,400
February. . . . .	3,100	$22,050

Read the requirements:

Use Excel to do the following:

a.	Run a regression analysis using data for August through February.
b.	Determine the lab's cost equation (use the output from the regression analysis you performed using Excel).
c.	Determine the R-square using the Excel output you obtain. What does the lab's R-square indicate?
d.	Predict the lab's total overhead costs for the month if 2,700 tests are performed.

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