The Rapid Engine Company is a multi-national manufacturer os small gasoline and Diesel motors. Rapid hs estimated the following cost experience for a new 3.5hp engine over a sample of 122 observations.

COST = $8,500 + $32 OUTPUT

Predictor Coef Stdv t Ratio

The Rapid Engine Company is a multi-national manufacturer os small gasoline and Diesel motors. Rapid hs estimated the following cost experience for a new 3.5hp engine over a sample of 122 observations.Constant 8,500 5,000 1.7

OUTPUT 32 8 4.0

__

SEE = $2,500, R2 75% R2 74.5%

Where COST is the dependent variable and OUTPUT is the independent variable

A.- Fully interpret these simple regression results using all the statistical information supplied

B.- Describe this cost category as a fixed or variable based upon the simple regression results described above.

C.- How might Rapid improve the value of this regression as a sales predictor.

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