TABLE 4.2 Data for Cost Control Exercise PAPER MACHINE OVERHEAD 1102 1008 1227 1
ID: 3317635 • Letter: T
Question
TABLE 4.2 Data for Cost Control Exercise PAPER MACHINE OVERHEAD 1102 1008 1227 1395 1710 1881 1924 1246 1255 550 502 616 LABOR 838 919 939 622 126 143 191 325 301 376 419 248 813 371 124 127 135 181 1314 1557 1887 1204 1211 1287 1451 1828 1903 1997 740 901 610 351 370 246 732 891 932 124 127 155 208 433 878 660 389 430 271 286 1363 1421 1543 1774 1929 1317 1302 1388 233 129 146 158 199 228 126 841 922 647 656 376 679 378 255 281 142 Source: These data were created by Dr. Roger L. Wright, RLW Analyties, Inc, Sonoma CA, and are used (with modification) with his permission. Stat PValue FIGURE 4.8 Regres-Variable sion Results for Cost Control Exercise Coetficient Std Dev 0.026 0.000 0.000 0.927 0.223 21.70 1.72 0.95 2.47 0.05 -0.05 Intercept PAPER 5.31 0.47 0.53 0.04 R-Sq(adj) 99.98 . R-Sq 99.9% . Standard Brror 11.0756 F Stat Analysis of Variance 4629.170.000 Regression42271423 2699 567856 123 Error Total 2274122 26Explanation / Answer
Solution:
From given ANOVA table we can see p-value is 0.00 which is less than 0.05 alpha value which means our model is significant.
Also we can see that Rsquare value is 99.9% which means our model explains 99.9% variance in cost due to all independent variables.
Independent variables paper and machine have p-value 0.00 which means these are significant and independent variable overhead and labour is not 0.967 and 0.223 which is greater than 0.05 which are non significant so we can remove these from our analysis and run regression again to increase R-square.
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