Oil Quality and Price Narrative

question 41

Essay

Oil Quality and Price Narrative
Quality of oil is measured in API gravity degrees; the higher the degrees API, the higher the quality. The table shown below was produced by an expert in the field who believes that there is a relationship between quality and price per barrel. A partial MINITAB output follows:
Descriptive Statistics Covariances
Degrees Price
Degrees 21.281667
Price 2.026750 0.208833
Regression Analysis S = 0.1314 R-Sq = 92.46% R-Sq(adj) = 91.7%
Analysis of Variance
-Refer to Oil Quality and Price Narrative. Use the equation to determine the predicted values of y.

---

Definitions:

Selling Price

The amount for which a product or service is sold to a customer.

Variable Costs

Costs that change in proportion to the level of production or business activity.

Cost Center

A department or unit within an organization to which costs can be allocated, but that does not directly generate revenue.

Performance Evaluation

The systematic process of assessing and reviewing an employee’s job performance and productivity in relation to established criteria and objectives.