Retail Price Data for N = 60 Hard Disk Drives $y =$

question 77

Essay

Retail price data for n = 60 hard disk drives were recently reported in a computer
magazine. Three variables were recorded for each hard disk drive: $y =$ Retail PRICE (measured in dollars)
$x _ { 1 } =$ Microprocessor SPEED (measured in megahertz)
(Values in sample range from 10 to 40 )
$x _ { 2 } =$ CHIP size (measured in computer processing units)
(Values in sample range from 286 to 486 )
A first-order regression model was fit to the data. Part of the printout follows:


Test to determine if the model is adequate for predicting the price of a computer. Use $\alpha =$ $.01$ .

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Definitions:

Total Cost Data

The sum of all costs associated with the production or delivery of goods and services.

Mixed Cost

A cost that contains both variable and fixed cost components, making it partly dependent on the level of output or activity.

High-low Method

A method utilized in cost accounting that predicts variable and fixed expenses by examining the most and least active periods.

Maintenance Cost

Expenses incurred to keep property, equipment, or machinery in efficient operating condition.