A warehouse manager is examining the process distribution to find out the factors that affect warehouse distribution
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Question:
A warehouse manager is examining the process distribution to find out the factors that affect warehouse distribution costs. Currently, a small handling fee is added to the order, regardless of the amount of the order.Data have been taken over the past 10 months indicating thewarehouse distribution costs and the number of orders received. The results are shown below.
Months | Distribution costs($) | Number of orders |
1 | 627 | 312 |
2 | 216 | 376 |
3 | 1215 | 920 |
4 | 906 | 956 |
5 | 1016 | 943 |
6 | 753 | 600 |
7 | 591 | 473 |
8 | 378 | 274 |
9 | 463 | 538 |
10 | 974 | 713 |
- Compute the simple linear regression coefficients, b0 and b1, and state the linear regression model.
- In one sentence each, interpret the meaning of b0 and b1 in this problem.
- Use the regression equation developed in (b) to predict the monthly distribution warehouse costs when the number of orders is 390.
- What is the value of the coefficient of determination (R-square)?
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