Scatter Diagrams and High-Low Cost Estimation From April 1 through October 31, Coles County Highway Department hires temporary employees to mow and clean the right-of-way along county roads. The County Road Commissioner has asked you to help her in determining the variable labor cost of mowing and cleaning a mile of road. The following information is available regarding current-year operations:

Month	Miles Mowed and Cleaned	Labor Costs
April	240	$6,800
May	305	7,680
June	325	8,310
July	275	7,200
August	220	6,550
September	200	5,760
October	75	4,960

Use the information from the high- and low-volume months to develop a cost-estimating equation for monthly labor costs.

Monthly labor costs

=

Answer 3955

+

Answer 13.4

X

Plot the data on a scatter diagram. Using the information from representative high- and low volume months, use the high-low method to develop a cost-estimating equation for monthly labor costs.

Monthly labor costs

=

Answer

+

Answer

X

Adjust the equation developed in requirement (b) to incorporate the effect of an anticipated 5% increase in wages.

Monthly labor costs=Answer+AnswerX