In the linear trend equation which variable represents the average change in the dependent variable for every unit change in time? A) B) C) D) ˆAnswer: a b t YB Difficulty: Medium Goal: 2 62. For a time series beginning with 1988 and extending up to 2007, which year would be coded with a one when using the coded method? B Difficulty: Medium Goal: 2 Statistical Techniques in Business & Economics, Lind/Marchal/Wathen, 13/e21

63. For an annual time series extending from 1997 through 2007, how many years would be lost in a three year moving average? B Difficulty: Medium Goal: 3 AACSB: AS64. Given the trend equation ˆY= 25 + 0.6t(base year = 2000), what would be the forecast value for 2004? B Difficulty: Medium Goal: 5 2004-2000*1=5 Y=25+0.6*565. How can you describe the moving average method? A) Useful in smoothing out a time series B) Used in measuring seasonal fluctuations C) A technique which does not result in an trend line equation D) A method for identifying a trend E) All of the above Answer: E Difficulty: Medium Goal: 3 66. For a five-year moving average, how many values will be lost at the beginning and end of the time series? C Difficulty: Medium Goal: 3 67. A linear trend equation is used to represent time series values when the data are changing by equal? C Difficulty: Medium Goal: 2 Test Bank, Chapter 1622

68. If time series data plotted on graph paper having an arithmetic scale increases or decreases by equal percents, how will the graph look? C Difficulty: Medium Goal: 4 AACSB: AS69. Which of the following is true for the linear equation, ˆY= a+ bt? A) log a= S log ˆB) log ˆY= log a + log bC) log b= S(Xlog ˆY) / D) All of the above are true E) None of the above is true Answer: Y/ n (t) t2 E Difficulty: Medium Goal: 4 70. Given a linear time series trend, ˆY= 5.2 + 3.1t,what is the forecast for 2002 if the time series startedin 1995? C Difficulty: Medium Goal: 5 2002-1995+1=8 Y=5.2+3.1*871. What time series component was exemplified during the 1980's when the American economy enjoyeda period of prosperity? B Difficulty: Medium Goal: 1 72. What is a disadvantage of the estimating method for determining a trend line equation? B Difficulty: Medium Goal: 2 Statistical Techniques in Business & Economics, Lind/Marchal/Wathen, 13/e23

73. A logarithmic straight-line trend equation should be used for forecasts when the time series is increasing by?