Thane Company is interested in establishing the

Thane Company is interested in establishing the relationship between electricity costs and machine hours. Data have been collected and a regression analysis prepared using Excel. The monthly data and the regression output follow:
MonthMachine HoursElectricity Costs
January3,400$18,850
February3,800$21,900
March2,800$13,950
April4,000$23,900
May4,700$28,700
June4,200$22,900
July5,300$25,200
August4,400$23,200
September2,900$16,400
October4,600$26,900
November6,500$31,900
December5,800$28,200


Summary Output
Regression Statistics
Multiple R.928
R Square.862
Adjusted R2.848
Standard Error2,039.35
Observations12.00



CoefficientsStandard Errort StatP-valueLower 95%Upper 95%
Intercept4,492.222,479.751.810.10(1,033.00)10,017.44
Machine Hours4.350.557.890.003.125.58


If the controller uses regression analysis to estimate costs, the cost equation for electricity cost is:

Cost = $4,492.22 + $2,479.75 × Machine-hours.

Cost = $2,479.75 + $0.55 × Machine-hours.

Cost = $4,492.22 + $4.35 × Machine-hours.

Cost = $2,039.35 + $12.00 × Machine-hours.