The High-Low Method of Estimating the Fixed and Variable Components

question 81

True/False

The high-low method of estimating the fixed and variable components of a mixed cost is a precise approach that uses a statistical technique.

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Definitions:

Annual Time-Series

A sequence of data points recorded or measured at successive time intervals, each interval being one year, used to analyze trends over time.

Moving Averages

A mathematical method that examines time series information by generating a sequence of means from various segments of the entire data set.

Seasonal Variation

It refers to periodic fluctuations in data or observations that occur regularly based on seasonal changes throughout the year.

Cyclical Movement

Refers to the fluctuating trends in economic variables or indicators that follow the cyclical ups and downs of the economy over time.