Ellington Corporation uses least-squares regression to analyze avariety of operating costs. A staff assistant determined thatmonthly machine hours (MH) have a strong cause-and-effectrelationship with total maintenance costs, and generated thefollowing statistics: Intercept: $170,000 b coefficient: $3.80Total machine hours for the year: 36,500
Required: A. Construct the company's regression equation. B.Based on your answer in part "A," identify Ellington's dependentvariable and independent variable. C. What does the b coefficientreally represent? D. Predict the company's maintenance cost in amonth when 3,200 machine hours are worked.
