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Accountants at the Tucson firm, Larry Youdelman, CPAs, believed that several traveling executives were submitting unusually high travel vouchers when they returned from business trips. First, they took a sample of 200 vouchers submitted from the past year. Then they developed the following multiple-regression equation relating expected travel cost to number of days on the road (₁) and distance traveled (₂) in miles:

The coefficient of correlation computed was .68.

a) If Barbara Downey returns from a 300-mile trip that took her out of town for 5 days, what is the expected amount she should claim as expenses?

b) Downey submitted a reimbursement request for $685. What should the accountant do?

c) Should any other variables be included? Which ones? Why?