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# Trend Equations

The data in DJIA.XLS (CD-> browse->Excel_Data_Files) represent the closing value of the Dow Jones Industrial Average (DJIA) over the 24-year period 1979 through 2002. See Problem 15.17. Using EXCEL or PHStat2, answer the following:
1. Find a linear trend equation to these data.
a) Y^ = -934.2717 + 452.5928X
b) Y^ = 934.2717 + 452.5928X
c) Y^ = -934.2717 - 452.5928X

2. Find a quadratic trend equation to these data.
a) Y^ = -934.2717 + 452.5928X + 36.0199X2
b) Y^ = 896.9213 - 468.2345X + 21.7138X2
c) Y^ = 896.9213 - 46.82345X + 21.7138X2

3. Find an exponential trend equation to these data.
a) log10Y^ = 1528.8697 - 259.9109X
b) log10Y^ = 2.8797 + 0.05241X
c) log10Y^ = 2861.4 + 0.0549X

4. Which model appears to be the most appropriate?
a) Linear trend model
c) Exponential trend model

5. Using the most appropriate model as selected in 4), forecast the closing value for the DJIA in 2003.
a) 8,161.8278
b) 13,724.2782
c) 11,199.5167

Year Coded Year DJIA
1979 0 838.7
1980 1 964
1981 2 875
1982 3 1046.5
1983 4 1258.6
1984 5 1211.6
1985 6 1546.7
1986 7 1896
1987 8 1938.8
1988 9 2168.6
1989 10 2753.2
1990 11 2633.7
1991 12 3168.8
1992 13 3301.1
1993 14 3754.1
1994 15 3834.4
1995 16 5117.1
1996 17 6448.3
1997 18 7908.3
1998 19 9181.4
1999 20 11497.1
2000 21 10788
2001 22 10021.5
2002 23 8341.6

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