Hill Top Products Has Run a Regression Analysis Comparing Total

question 91

Multiple Choice

Hill Top Products has run a regression analysis comparing total production and utilities' costs for the past six months.The regression analysis shows an R square (R²) of .86.Which of the following statements best describes the meaning of R²?

• A) 86 per cent of the company's total costs are utilities costs.
• B) 86 per cent of the variation in utilities costs is not explained by the increase or decrease in production.
• C) 86 per cent of the variation in utilities costs is explained by the increase or decrease in production.
• D) 86 per cent of the company's total costs are fixed costs and the remaining 14 per cent are variable costs.

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