When using the high-low method using an outlier as a data point is acceptable as long as the outlier is within the relevant range.

Question

Quizplus · Accepted Answer

The high-low method aims to estimate the variable and fixed components of a cost by using the highest and lowest activity levels. Using an outlier, even if it's within the relevant range, can distort the analysis because it does not represent typical operating conditions.

When Using the High-Low Method Using an Outlier as a Data