Let be a straight line of best fit by using least square method to the following data:
Year(x) 2018 2019 2020 2021 2022 2023 2024 Profit(y) (in Rs. '000) 114 130 126 144 138 156 164
Then the trend value for the year 2024 is:
Let be a straight line of best fit by using least square method to the following data:
| Year(x) | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|---|---|
| Profit(y) (in Rs. '000) | 114 | 130 | 126 | 144 | 138 | 156 | 164 |
Then the trend value for the year 2024 is:
Solution
✅ Correct Option: 3
The trend line equation is given by:
where represents the year and represents the profit (in Rs. '000).
The trend value is the predicted profit from the equation, not the actual profit from the data table.
For year 2024, substitute into the equation:
Therefore, the trend value for year 2024 is (in Rs. '000).
Note: The actual profit shown in the table for 2024 is 164, but the trend value of 161.78 is what the regression line predicts.
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