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Assume the following data (where the xxx is the last three digits of your panther id):

Last three digits of Panther ID to use in the question: 921

Month	Machine Hours (hrs.)	Maintenance Costs ($)
1	1,240	100,xxx
2	1,400	107,xxx
3	1,230	102,xxx
4	1,470	108,xxx
5	1,620	116,xxx
6	1,660	115,xxx
7	1,490	107,xxx
8	1,280	101,xxx
9	1,460	106,xxx
10	1,580	113,xxx
11	1,300	100,xxx
12	1,600	113,xxx
13	1,650	113,xxx
14	1,440	109,xxx
15	1,350	102,xxx
16	1,670	116,xxx
17	1,480	106,xxx
18	1,360	103,xxx
19	1,340	103,xxx
20	1,540	112,xxx
21	1,320	102,xxx
22	1,410	104,xxx
23	1,220	101,xxx

For example, if your panther id is 1234567, then your maintenance costs would be $103,567 in month 1; $107,567 is month 2; $113,567 in months 10, 12, and 13.

Assume that the following relationship holds:

Maintenance Costs = a + (b * Machine Hours)

REQUIRED

Estimate the values of a and b, using,

1. the High-Low Method, and

2. the Linear Regression method

Note, to use the linear regression method, you MUST use the Microsoft Excel program.

Make sure to report

i) the values of a and b

ii) a scatter plot of the data points, and

iii) the R-square or the adjusted R-square

3. Which of the above two methods is more appropriate? Why? (3 sentences maximum)

Answer & Explanation Solved by verified expert

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