High-Low Method.The city of Rockville reported the following annual cost data for maintenance work performed on its fleet of trucks.

Reporting Period (Year)Total CostsLevel of Activity (Miles Driven)Year 1 $750,000 (225,000) miles Year 2 $850,000 (240,000) miles Year 3 $1,100,000 (430,000) miles Year 4 $1,150,000 (454,000) miles Year 5 $1,250,000 (560,000) miles Year 6 $1,550,000 (710,000) Miles

Required:

1. Use the four steps of the high-low method to estimate total fixed costs per year and the variable cost per mile. State your results in the cost equation form Y =f+vX.
2. What would the estimated costs be if the trucks drove 500,000 miles in year 7?