Question 1: Develop cost function estimates for Netflix and Blockbuster using :
- Account classification
- High-low
- Regression analysis methods
Question 2: In your opinion, which method best estimates cost functions for both Netflix and Blockbuster? Explain.
Question 3: Which of Netflix's or Blockbuster's costs might you appropriately estimate using the account classification method? Why?
Question 4: Which of Netflix's or Blockbuster's costs might you appropriately estimate using the high-low method? Why?
Question 5: Which of Netflix's or Blockbuster's costs might you appropriately estimate using the regression analysis method? Why?
Question 6: Are there any other methods of estimating cost functions?
Question 7: In general, which cost function estimation method is likely to be the best and why? Under what conditions is, or are, the best method(s) inappropriate?