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Bargain Rental Car offers rental cars in an off-airport location near a major tourist destination in California. Management would like to better understand the behavior
Bargain Rental Car offers rental cars in an off-airport location near a major tourist destination in California. Management would like to better understand the behavior of the company's costs. One of those costs is the cost of washing cars. The company operates its own car wash facility in which each rental car that is returned is thoroughly cleaned before being released for rental to another customer. Management believes that the costs of operating the car wash should be related to the number of rental returns. Accordingly, the following data have been compiled: Month Rental Returns Car Wash Costs January 2,380 $10,825 February 2,421 $11,865 March 2,586 $11,332 April 2,725 $12,422 May 2,968 $13,850 June 3,281 $14,419 July 3,353 $14,935 August 3,489 $15,738 September 3,057 $13,563 October 2,876 $11,889 November 2,735 $12,683 December 2,983 $13,796 Required: Using least-squares regression, estimate the fixed cost elements of monthly car wash costs
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