LuxuBus is an intercity medium range bus transportation company that manages routes in the American Northeast

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LuxuBus is an intercity medium range bus transportation company that manages routes in the American Northeast. Luquus currently prepares the meals it serves to its premium travelers. In October 2019, Luquus prepared 180,000 meals at a total cost of $1,980,000. RedCater, a catering company headquartered in Elmira, New York, presented Luquus an offer to outsource the onboard meal preparation for a ?xed price of $10.40 per meal, for quantities between 40,000 and 500,000 meals per month. Luquus forecasts that it will need an average of 210,000 meals per month in the foreseeable future. 1. What was Luxubus's average cost of preparing a meal in August 2019? How does it compare to the price quoted by RedCater'? 2. If you were the sourcing manager of Luxubus, would you use the average costs calculated in the previous question to assess the relative attractiveness of RedCater's offer? Justify your answer. 3. Ben Acasa, an intern in Luxubus' sourcing department has prepared a report on the economics of the offer. Using regression analysis and monthly data from the previous three years, Acasa estimated the following cost ?mction for the meals prepared by Luxubus: Total Cost: $505,000 + $8.5 X Number of meals The number of meals prepared in the months used to estimate the regression equation ?uctuated between 120,000 and 250,000. What would be the predicted cost of producing 210,000 onboard meals as per the estimated cost ?anction? How does this cost compare with the price quoted by RedCater? 4. What additional information would you request from Acasa to be con?dent that the cost equation he estimated produces accurate predictions of the cost of producing the meals?