Question

Customer	Number of cases	Delivery Time
1	52	32.1
2	64	34.8
3	73	36.2
4	85	37.8
5	95	37.8
6	103	39.7
7	116	38.5
8	121	41.9
9	143	44.2
10	157	47.1
11	161	43
12	184	49.4
13	202	57.2
14	218	56.8
15	243	60.6
16	254	61.2
17	267	58.2
18	275	63.1
19	287	65.6
20	298	67.3

Management of a soft-drink bottling company wants to develop a method for allocating delivery costs to customers. Although one cost clearly relates to travel times within a particular route, another variable cost reflects the time required to unload the cases of soft drink at the delivery point. A sample of 20 deliveries within a territory was selected. The delivery time and the number of cases delivered were recorded. Develop a regression model to predict delivery time based on the number of cases delivered. Use the least-square method to calculate the regression coefficients, b0 and b1. Showing all formulas and equations a) Write your regression equation. b) Determine the coefficient of determination, r2, and explain it meaning in this problem. c) Perform a residual analysis. Is there any evidence of patterns in the residuals? Explain.

Answer 1