Question

Evaluating alternative simple regression models, not-for-profit. (Chapter Appendix) ^ Kathy Hanks, executive assistant to the president of Eastern University, is concerned about the overhead costs at her university. Cost pressures are severe, so controlling and reducing overhead is very important. Hanks believes overhead costs incurred are generally a function of the number of different academic programs (including different specializations, degrees, and majors) that the university has and the number of enrolled students. Both have grown significantly over the years. She collects the following data:
INSTRUCTIONS
Form groups of two or more students to complete the following requirements:
REQUIRED
1. Plot the relationship between overhead costs and each of the following variables: (a) number of academic programs and (b) number of enrolled students.
2. Compare and evaluate the two simple regression models estimated by Hanks. Use the comparison format employed in Exhibit 10-12.
3. What insights do the analyses provide about controlling and reducing overhead costs at the university?
4. What are two important issues that would suggest the predictions are unreliable?


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  • CreatedJuly 31, 2015
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