Using the data of Problem 15.6 on page 581, stored in Cost Estimation, perform a natural logarithm transformation of the dependent variable (total cost). Using the transformed dependent variable and the unit production as the independent variable, perform a regression analysis.
a. State the regression equation.
b. Predict the total cost when production is 145 units.
c. Perform a residual analysis of the results and determine whether the regression assumptions are valid.
d. At the 0.05 level of significance, is there a significant relationship between the natural logarithm of total cost and unit production?
e. Interpret the meaning of the coefficient of determination, r2, in this problem.
f. Compute the adjusted r2.
g. Compare your results with those in Problem 15.6. Which model is better? Why?