A company that leases trucks to other companies collect information on total miles driven (100,000 miles) and total maintenance cost (in thousand dollars) for each of 10 trucks in their rental fleet. The company is interested in modeling the relationship between total maintenance cost and total miles of operation so it can more accurately establish mileage charges for leasing these trucks. The analysis is done by SPSS. The output is provided below.

a.) The company wants to estimate the average maintenance cost for trucks driven 300,000 miles and 500,000 miles. One can use either the Bonferroni method or Working- Hoteling method to construct the intervals at a 90% family confidence level. Find the critical value for each procedure. Which procedure will you recommend? Briefly explain. (You do not have to compute the actual interval.)

b) Comment on the residual plot and suggest a remedial measure if needed.

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Model 1 Regression Residual Total a. Predictors: (Constant), MILES b. Dependent Variable: COST Model 1 Sum of Squares 904.257 20.703 924.960 B -2.702 4.751 a. Dependent Variable: COST (Constant) MILES ANOVA df Un standardized Coefficients 1 8 9 Coefficientsª Std. Error .959 .254 Mean Square 904.257 2.588 Standardized Coefficients Beta .989 F 349.417 t -2.817 18.693 Sig. .000a Sig. .023 .000 Model 1 Regression Residual Total a. Predictors: (Constant), MILES b. Dependent Variable: COST Model 1 Sum of Squares 904.257 20.703 924.960 B -2.702 4.751 a. Dependent Variable: COST (Constant) MILES ANOVA df Un standardized Coefficients 1 8 9 Coefficientsª Std. Error .959 .254 Mean Square 904.257 2.588 Standardized Coefficients Beta .989 F 349.417 t -2.817 18.693 Sig. .000a Sig. .023 .000