In which step of estimating a cost function using quantitative analysis would a manager realize all items of costs in the dependent variable have different cost drivers?
A)Step 1: Choose the Dependent Variable.
B)Step 2: Identify the Independent Variable,or Cost Driver.
C)Step 3: Collect Data of the Dependent Variable and the Cost Driver.
D)Step 4: Plot the Data.
E)Step 5: Estimate the Cost Drive of the Estimated Cost Function.

Question

Quizplus · Accepted Answer

In step 2, the manager identifies the independent variable or cost driver. If all items of costs in the dependent variable have different cost drivers, this would be realized in this step. It is important to correctly identify the cost driver as it is used to estimate the cost function.

In Which Step of Estimating a Cost Function Using Quantitative