A method that estimates cost behavior by using just the highest and lowest volume levels is called the

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Business

Azaria

1 May, 09:47

A method that estimates cost behavior by using just the highest and lowest volume levels is called the

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Hailie Becker · Answer 1

A method that estimates cost behavior by using just the highest and lowest volume levels is called the: High-low method.

In doing high-low method of cost estimation, we need to conduct some sort of experiment. First, we try the highest level of activity and record the total cost incurred, then we try the lowest level of activity and record the total cost incurred. After that, we used these two baselines to estimate the total cost of our production.