Madison County Airport handles several daily commuter flights and many private flights. The county budget officer has compiled the following data regarding airport costs and activity over the past year.

Required:
1. Draw a scatter diagram of the airport costs shown above.
2. Construct an Excel spreadsheet and use the Excel commands to perform a least-squares regression. Estimate the variable- and fixed-cost components in the airport's cost behavior pattern.
3. Write the least-squares regression equation for the airport's costs.
4. Predict the airport's costs during a month when 1,600 flights originate at the airport.
5. Using the Excel spreadsheet prepared for requirement (2), compute the coefficient of determination (R2) for the regression equation. Briefly interpret R2.

Transcribed Image Text:

Flights Originating at Madison County Airport Month January February Airport Costs 20,000 17,000 19,000 18,000 19,000 20,000 18,000 24,000 19,000 21,000 17,000 21,000 1,100 1,400 May June July 1,000 1,200 1,100 1,400 1,000 1,200 September . November 1,500