A regional express delivery service company recently conducted a study to investigate the relationship between the cost of shipping a package (Y ), the package weight (X1), and the distance shipped...

A regional express delivery service company recently conducted a study to investigate the relationship between the cost of shipping a package (Y ), the package weight (X1), and the distance shipped (X2). Twenty packages were randomly selected from among the large number received for shipment, and a detailed analysis of the shipping cost was conducted for each package. These sample observations are given in the file P16_20.xlsx.

a. Estimate a simple linear regression model involving shipping cost and package weight. Interpret the slope coefficient of the least squares line as well as the value of R-square.


b. Add another explanatory variable—distance shipped—to the regression model in part a. Estimate and interpret this expanded model. How does the R-square value for this multiple regression model compare to that of the simple regression model estimated in part a? Explain any difference between the two R-square values. How can you use the adjusted R-squares for a comparison of the two models?