Refer to Exercise 16.132, where a simple linear regression model was used to analyze the relationship between welding machine breakdowns and the age of the machine. The analysis proved to be so useful to company management that it decided to expand the model to include other machines. Data were gathered for two other machines. These data as well as the original data were recorded in the following way:

Column 1: Cost of repairs

Column 2: Age of machine

Column 3: Machine (1 = welding machine;

2 = lathe; 3 = stamping machine)

a. Develop a multiple regression model.

b. Interpret the coefficients.

c. Can we conclude that welding machines cost less to repair than other machines?

In exercise 16.132

The president of a company that manufactures car seats has been concerned about the number and cost of machine breakdowns. The problem is that the machines are old and becoming quite unreliable. However, the cost of replacing them is quite high, and the president is not certain that the cost can be made up in today’s slow economy. To help make a decision about replacement, he gathered data about last month’s costs for repairs and the ages (in months) of the plant’s 20 welding machines.