The Conch Cafe located in Gulf Shores Alabama features casua

The Conch Cafe, located in Gulf Shores, Alabama, features casual lunches with a great view of the Gulf of Mexico. To accommodate the increase in business during the summer vacation season. Fuzzy Conch, the owner, hires a large number of servers as seasonal help. When he interviews a prospective server he would like to provide data on the amount a server can earn in tips. He believes that the amount of the bill and the number of diners are both related to the amount of the tip. He gathered the following sample information. CIick here for the Excel Data File Develop a multiple regression equation with the amount of tips as the dependent variable and the amount of the bill and the number of diners as independent variables and complete the table. (Round your answers to 3 decimal places. Negative amounts should be indicated by a minus sign.) Write out the regression equation. (Negative amounts should be indicated by a minus sign. Round your answers to 3 decimal places.) How much does another diner add to the amount of the tips? (Round your answer to 2 decimal places. Omit the \"$\" sign in your response.) another diner on average adds $ | to the tip. Complete the ANOVA table. (Leave no cells blank - be certain to enter \"0\" wherever required. Round SS, MS to 3 decimal places and F to 2 decimal places.) Total

Solution

Thus the regression equation is:

Tip = 0.8502 + 0.052*Bill + 0.4495*Diners

Thus, an additional diner adds 0.4495$ ~ 0.45$ to the tip.

From the p-value, at 5% confidence level all the variables are significant.

Hence none of the variables must be deleted.

Performing the test individually, both the p-values are so small that Null hypothesis that atleast one of the coefficients is close to zero is rejected

Hence, no variable may be deleted.

R² = 0.7473

Adjusted R² = 0.7286

Hope this helps. Ask if you have any doubts.

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.86450613
R Square	0.74737085
Adjusted R Square	0.72865758
Standard Error	0.99180575
Observations	30
ANOVA
	df	SS	MS	F	Significance F
Regression	2	78.57234326	39.28617	39.93801	8.58078E-09
Residual	27	26.55932341	0.983679
Total	29	105.1316667
	Coefficients	Standard Error	t Stat	P-value	Lower 95%	Upper 95%	Lower 95.0%	Upper 95.0%
Intercept	0.85020851	0.401147147	2.119443	0.043394	0.027122549	1.673294463	0.027122549	1.673294463
Bill	0.05207978	0.009704799	5.366394	1.14E-05	0.032167177	0.071992385	0.032167177	0.071992385
Diners	0.44950432	0.122110915	3.681115	0.001022	0.198953421	0.700055224	0.198953421	0.700055224