b$.$ Should management use this equation to predict monthly operating$$ costs? Explain your answer.

This equation

$$

$$

probably should be used

should be used with caution

should not be used

to predict costs. The$$ R$-$square statistic can range from a high of

$$

$$

$0\mathrm{.}25$

$0\mathrm{.}50$

$0\mathrm{.}75$

$1\mathrm{.}00$

to a low of

$$

$$

$0$

$0\mathrm{.}10$

$0\mathrm{.}20$

$0\mathrm{.}25$

$.$

In this$$ case, the$$ R$-$square indicates that the cost equation

$$

$$

is very reliable

is not reliable

should be used with caution

$,$

indicating there

$$

$$

is a weak

is a fairly strong

may or may not be a

relationship between the potential cost driver and the advertising$$ agency's operating costs.