Grawburg Inc. maintains a call center to take orders, answer questions, and handle complaints. The costs of the call center for a number of recent months are listed below: Calls TakenCall Center CostApril9,030$112,323May9,017$112,278June9,035$112,341July9,065$112,458August9,015$112,290September9,061$112,419October9,070$112,463November9,067$112,439 Management believes that the cost of the call center is a mixed cost that depends on the number of calls taken. Required:Estimate the variable cost per call and fixed cost per month using the least-squares regression method.
What will be an ideal response?
Using Microsoft Excel functions, the solution is:
Variable cost per call = Slope = $3.27
Fixed cost per month = Intercept = $82,758
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