Requirement $2.$ Determine the$$ R$-$squared $($use the output from the Excel$$ regression$).$

The$$ R$-$squared is

$0\mathrm{.}754757$

$.$

Part $3$

What does

Flower Paradise$\text{'}$s

$$R$-$squared indicate?

The$$ R$-$squared indicates that the cost equation explains

$75\mathrm{.}5\%75\mathrm{.}5\%$

of the variability in the data. In other$$ words, it

does not fit the data at all.

Flower Paradise

will not

feel confident using this cost equation to predict total costs at other volumes within the same relevant range.