Knowledge Check 01 Which of the following is true of the linearity assumption? It assumes that the relationship between total cost and activity can be approximated by a straight line. O It assumes that total cost is a result of two independent variables, activity and fixed costs. O Conclusions of cost behavior analysis hold true even outside the analysis' relevant range. Olt assumes that total variable cost equals total fixed cost. Knowledge Check 02 In the equation y = a + b(x), y is the: O Dependent variable O Independent variable Intercept term Slope Knowledge Check 03 In the equation y = a + b(x), x is the: O Independent variable Slope O Intercept term Dependent variable