Consider the computer output in Table 12.5.12, part of an analysis to explain the final cost of a project based on management€™s best guess of labor and materials costs at the time the bid was placed, computed from 25 recent contracts. All variables are measured in dollars.
a. What percentage of the variation in cost is explained by the information available at the time the bid is placed?
b. Approximately how closely can we predict cost if we know the other variables?
c. Find the predicted cost of a project involving $9,000 in labor and $20,000 in materials.
d. Is the F test significant? What does this tell you?
e. Do materials have a significant impact on cost?

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TABLE 12.5.12 Regression Analysis for Final Cost of a Project Correlations: Cost 0.684 0.713 Material 0.225 Th e regression equation is Cost 13975 + 1.18 Labor + 1.64 Material Predictor Coeff StDev t-ratio 3.26 5.59 5.97 Constant 13975 4286 0.004 0.000 0.000 .1806 0.2110 Material 1.6398 0.2748 S-3860 R-sq-79.7% R-sq(adj)#77.8% Analysis of Variance Source Regression Error Total DF MS 43.17 1286267776 327775808 1614043648 643133888 0.000 14898900 24 Source DF SEQ SS 755914944 530352896 Material