Adam Madison, financial analyst at QTY Corporation, is examining the behavior of quarterly utility costs for budgeting purposes. Madison collects the following data on machine-hours worked and utility costs for the past 8 quarters: (Click the icon to view the data.) Read the requirements. Requirement 1. Estimate the cost function for the quarterly data using the high-low method. (Complete all answer boxes.) (After you hit continue, the screen may take you below the beginning of the next step. If so, scroll back up to the top of the step.) Requirement 2. Plot and comment on the estimated cost function. Plot the line for the estimated cost function using the high-low method. The data points for the 8 quarters have already been entered in for you. (Enlarge the gra @ i Requirements Data Table Quarter Quarter 1 1. Estimate the cost function for the quarterly data using the high-low method. 2. Plot and comment on the estimated cost function. 3. Madison anticipates that QTY will operate machines for 125,000 hours in quarter 9. Calculate the predicted utility costs in quarter 9 using the cost function estimated in requirement 1. Machine-Hours Utility Costs 120,000 $ 255,000 75,000 190.000 110,000 240,000 125,000 280,000 90,000 210,000 115,000 280,000 105,000 265,000 100,000 235,000 TT 025.00H OD 6,0000 OSCERO,000 Machine Hours Print Done Quarter 2 Quarter 3 Quarter 4 Quarter 5 Quarter 6 Quarter 7 Quarter 8 Click enlar graph Canto the artist art fundinn herinn the Statements with an fhirinn miris list hal Print Done Click the graph, choose a tool in the palette and follow the instructions to create your graph. 025,0450,006,0000,025, 01450,000 Machine-Hours Click to enlarge graph Comment on the estimated cost function by choosing the correct statement to go with each of the evaluation criteria listed below. Economic plausibility: The cost function shows a negative economically plausible relationship between machine-hours and utility costs. There is not a clear-cut relationship of higher machine-hours and utility costs. The cost function shows a positive economically plausible relationship between machine-hours and utility costs. There is a clear-cut relationship of higher machine-hours and utility costs. Goodness of fit: The high-low line appears to "fit" the data well. The vertical differences between the actual and predicted costs appear to be quite small. The high-low line appears to not "fit" the data well. The vertical differences between the actual and predicted costs appear to be quite large. Slope of high-low line: The slope of the line appears to be reasonably steep indicating that, on average, utility costs in a quarter vary with machine-hours used. The slope of the line appears to be unreasonably steep indicating that, on average, utility costs in a quarter do not vary with machine-hours used. Requirement 3. Madison anticipates that QTY will operate machines for 125,000 hours in quarter 9. Calculate the predicted utility costs in quarter 9 using the cost function estimated in requirement 1. The predicted maintenance costs would be for quarter 9. Adam Madison, financial analyst at QTY Corporation, is examining the behavior of quarterly utility costs for budgeting purposes. Madison collects the following data on machine-hours worked and utility costs for the past 8 quarters: (Click the icon to view the data.) Read the requirements. Requirement 1. Estimate the cost function for the quarterly data using the high-low method. (Complete all answer boxes.) (After you hit continue, the screen may take you below the beginning of the next step. If so, scroll back up to the top of the step.) Requirement 2. Plot and comment on the estimated cost function. Plot the line for the estimated cost function using the high-low method. The data points for the 8 quarters have already been entered in for you. (Enlarge the gra @ i Requirements Data Table Quarter Quarter 1 1. Estimate the cost function for the quarterly data using the high-low method. 2. Plot and comment on the estimated cost function. 3. Madison anticipates that QTY will operate machines for 125,000 hours in quarter 9. Calculate the predicted utility costs in quarter 9 using the cost function estimated in requirement 1. Machine-Hours Utility Costs 120,000 $ 255,000 75,000 190.000 110,000 240,000 125,000 280,000 90,000 210,000 115,000 280,000 105,000 265,000 100,000 235,000 TT 025.00H OD 6,0000 OSCERO,000 Machine Hours Print Done Quarter 2 Quarter 3 Quarter 4 Quarter 5 Quarter 6 Quarter 7 Quarter 8 Click enlar graph Canto the artist art fundinn herinn the Statements with an fhirinn miris list hal Print Done Click the graph, choose a tool in the palette and follow the instructions to create your graph. 025,0450,006,0000,025, 01450,000 Machine-Hours Click to enlarge graph Comment on the estimated cost function by choosing the correct statement to go with each of the evaluation criteria listed below. Economic plausibility: The cost function shows a negative economically plausible relationship between machine-hours and utility costs. There is not a clear-cut relationship of higher machine-hours and utility costs. The cost function shows a positive economically plausible relationship between machine-hours and utility costs. There is a clear-cut relationship of higher machine-hours and utility costs. Goodness of fit: The high-low line appears to "fit" the data well. The vertical differences between the actual and predicted costs appear to be quite small. The high-low line appears to not "fit" the data well. The vertical differences between the actual and predicted costs appear to be quite large. Slope of high-low line: The slope of the line appears to be reasonably steep indicating that, on average, utility costs in a quarter vary with machine-hours used. The slope of the line appears to be unreasonably steep indicating that, on average, utility costs in a quarter do not vary with machine-hours used. Requirement 3. Madison anticipates that QTY will operate machines for 125,000 hours in quarter 9. Calculate the predicted utility costs in quarter 9 using the cost function estimated in requirement 1. The predicted maintenance costs would be for quarter 9