Consider Camp Rainbow's cost equation results obtained in E5-11 using least-squares regression.

Suppose that Rainbow is contemplating staying open one additional week during the summer.

Required:
1. Determine Rainbow's contribution margin per camper if each camper pays $175 to attend the camp for a week.
2. Prepare a contribution margin income statement for week 9 assuming Rainbow expects to have 170 campers that week.
3. Explain whether Rainbow should add a ninth week to its schedule.

Transcribed Image Text:

Number of Campers 90 118 156 174 188 184 170 156 Week Cost to Run Camp 8,050 8,460 10,900 11,100 13,670 14,300 12,325 11,270