Weaknesses of the high-low method include all of the following EXCEPT
A)only two observations are used to develop the cost function.
B)the high and low activity levels may not be representative.
C)the method does not detect if the cost behaviour is nonlinear.
D)the method is relatively complex and difficult to apply.

Question

Quizplus · Accepted Answer

The high-low method is generally considered a simple and easy-to-use cost estimation method compared to other methods, such as regression analysis. Therefore, the weakness of the high-low method is not related to its complexity or difficulty in application. The other options (A, B, and C) are valid weaknesses of the high-low method.

Weaknesses of the High-Low Method Include All of the Following