The manager of the main laboratory facility at

UrbanHealth

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. The lab manager collected the following data for the first seven months of the year.

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Part 1

The laboratory manager performed a regression analysis to predict total laboratory overhead costs. The output generated by Excel is as follows:

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Part 1

Requirement 1. Determine the lab's cost equation (use the output from the Excel regression). (Round the amounts to two decimal places.)

y =

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Data table Month January ..... February .... March .... April.... May June July Number of Lab Tests Performed 3,200 2,900 3,700 4,100 Total Laboratory Overhead Costs $27,200 $26,500 $30,300 $32,600 $30,000 $ 19,000 $19,400 4,400 1,900 2,500 Data table D E F G N A B C 1 SUMMARY OUTPUT 2 Regression Statistics 3 Multiple R 0.923177 4 R Square 0.852256 5 Adjusted R Square 0.822708 Standard Error 2247.944406 7 Observations 7 8 ANOVA 6 9 df SS MS F Significance F 0.003013 10 Regression 1 1457480 15.44 28.842408 145748015.44 25266270.27 11 Residual 5 5053254.054 12 Total 6 171014285.71 13 t Stat P-value Lower 95% Coefficients 8478.92 Standard Error 3448.565 2.459 0.057 -385.899 14 Intercept 15 X Variable 1 Upper 95% 17343.737 8.185 5.54 1.031 5.371 0.003 2.886 Requirements 1. Determine the lab's cost equation (use the output from the Excel regression). 2. Determine the R-squared (use the output from the Excel regression). 3. Predict the total laboratory overhead for the month if 3,100 tests are performed