Case problem on North-south airline: Regression Analysis
1. Prepare a Peg Jone's response to Stephen Ruth.
Please see the attached file.
Peg’s response to Stephen Ruth
Using Excel, four regression equations are developed for the Cost Vs Age. Following are the equations:
For Northern Airlines:
Airframe maintenance cost = 36.097 + Average fleet age * 0.0026
Coefficient of Correlation, r=0.877
Coefficient of Determination, r2 = 0.769
Engine maintenance cost = 20.571 + Average fleet age * 0.0026
Coefficient of Correlation, r=0.783
Coefficient of Determination, r2 = 0.612
It can be seen from the r2 value of 0.769 that there is a moderate relationship between the Air frame maintenance cost and the Air fleet age. This means that Air fleet age determines only 76.9% of variation ...
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