Your boss wants you to analyze the relationship between the company's monthly operating costs and the current cost driver she has chosen. You run a regression analysis and receive the following information: Intercept Coefficient = 653,434
X Variable 1 Coefficient = 5.76
R-square = 0.3784
What is your company's monthly cost equation?
A)y = $653,434x + $5.76
B)y = $0.38x + $653,434
C)y = $5.76x + $653,434
D)y = $0.38x + $576

Question

Quizplus · Accepted Answer

The monthly cost equation is in the form of y = mx + b, where y is the monthly operating cost, x is the cost driver, m is the coefficient for the cost driver, and b is the intercept coefficient. From the given information, we have:
y = 5.76x + 653,434
Therefore, the correct answer is C.

Your Boss Wants You to Analyze the Relationship Between the Company's