Total Operating Cost - Essay Example

Population, Revenue Ton, Ton-Mile load factor, capacity, assets and Investments and Special Funds are all significant at α= 0.05 level of significance. Population, Revenue Ton, and Investments and Special Funds affect total operation cost positively while Ton-Mile load factor, capacity, and assets seem to affect the total operation cost negatively. Discussion and conclusion Capacity, Assets, Daily Flight Time, and Flight Length in miles were suspected to be the main variables that determine total operating costs.

The correlation and linear regression, however, indicate that only capacity and assets have a significant effect on the total operating cost. When studied together with other variables, Daily Flight Time and Flight Length in miles do not seem to have a significant effect on operation cost. To further investigate if the two variables have an effect on the operation cost, a marginalized study should be conducted. There is a negative linear relationship between total operation cost and capacity and speed of the plane.

The relationship is a negative one as shown in Figures 1 and 2 in the appendices. The ANOVA results in Table 5 in the Appendices indicate that there is at least one variable that has an effect on operation cost. The linear regression model, however, proves this by indicating that Population, Revenue Ton, Ton-Mile load factor, capacity, assets and Investments, and Special Funds are all significant. The limitations of these findings should be noted. Only linear relationships were explored.