1. XYZ company operates a chain of shops. The companys chief executive officer is interested in accumulating some information on the utility costs incurred by the company. You have been asked to analyze the following twelve months data.

Month	Utility Cost	Number of Units
Jan	$ 5,100	7,500
Feb	$ 5,300	7,800
Mar	$ 5,650	8,000
Apr	$ 6,300	9,200
May	$ 6,400	9,800
Jun	$ 6,700	10,800
Jul	$ 7,035	11,800
Aug	$ 7,000	11,200
Sept	$ 6,200	9,500
Oct	$ 6,100	9,000
Nov	$ 5,600	8,500
Dec	$ 5,900	9,000

1. Using the high-low method calculate the variable rate for the total utility costs.

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2. Using the high-low method and variable rate entered above calculate the fixed cost for total utility costs.

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3. Using the method of least squares, your regression analysis produced an intercept of $1,920 and independent variable of 0.50. using the results of the regression analysis calculate the total utility costs for 10,000 units

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4. The CEO would like to understand what the advantages and disadvantages of the method of least squares and the high-low method.

Excludes outliers automatically

This method is objective

Simple to calculate

Uses all of the data points

(step-by-step solution is preferred**)