Madrigal Theater Company is interested in estimating fixed and variable costs. The following data are available:

Required
a. Use the high-low method to estimate fixed cost per month and variable costs per ticket sold [i.e., estimate a and b in the equation Cost = a + (b × # of tickets) using the high-low method].
b. Madrigal Theater Company is considering an advertising campaign that is expected to increase annual sales by 15,000 tickets. Assume that the ticket selling price is $25. Ignoring the cost of the advertising campaign, what is the expected increase in profit associated with the advertising campaign?
c. (Optional) Repeat part a using regression analysis. In light of the result, how would you answer part b? Round unit variable cost to five decimal places.

aruary February March April May LUFne July August September October November December Cost $160,000 190,000 215,000 217,000 209,500 194,500 240,000 172,000 185,000 202,000 191,500 207,000 No. of Tickets Sold 19,000 22,000 28,000 29,000 29,500 24,500 35,000 20,000 22,000 26,000 23,500 30,000