Prepare and interpret a scatter plot (Learning Objective 3)

Dave’s “Golden Brown” Pancake Restaurant features sourdough pancakes made from a strain of sourdough dating back to the Alaskan gold rush. To plan for the future, Dave needs to figure out his cost behavior patterns. He has the following information about his operating costs and the number of pancakes served:

1. Prepare a scatter plot of Dave’s pancake volume and operating costs. (Hint: If you use Excel, be sure to force the vertical axis to zero. See the “Technology Makes It Simple” feature on pages 319-320.)
2. Does the data appear sound, or do there appear to be any outliers? Explain.
3. Based on the scatter plot, do operating costs appear to be variable, fixed, or mixed costs?
4. How strong of a relationship is there between pancake volume and operating costs?

Transcribed Image Text:

Month Number of Pancakes Total Operating Costs July 3,600 $2,338 August 3,900 $2,390 September 3,200 $2,320 October 3,300 $2,272 November 3,850 $2,562 December 3,620 $2,534