You have been hired recently as a part-time cost analyst for your college's admissions office. Your first task is to estimate the relationship between the cost of operating the admissions office and the number of applications received. After painstakingly collecting six months worth of data, you analyzed the cost behavior using three different methods. You wrote up a brief report and headed for the admissions director's office. However, a gust of wind caught the papers in your hand and blew them out the window, where they were torn to bits by the hockey coach's dog. You and your roommate managed to piece together the following bits and pieces of information from your shredded report.

a. Least-squares regression:

Total monthly admissions department costs = ? + ?X, where X denotes the number of applications in thousands.

b. High-low method:

c. Visual-fit method:

Required:
1. Complete the cost analysis and report by finding the missing amounts.
2. Under each cost estimation method, predict the total cost of operating the admissions office during a month when 18,000 applications are received.

Transcribed Image Text:

? ? ? ? November 25 December 10 Month August. September October Applications Received (in thousands) 222 20 Cost of Operating the Admissions Office (in thousands) ? x 10.0 ? 22 ? ? 8.9 ? 178.0 9.1 ? 200.2 ? ? 240.0 ? ? ? January ? 8.7 225 ? Total.... ? ? 2,734 ?