Skip to main contentSkip to solution

The following data shows the percentage of rural and urban Indian households who have a high speed internet connection.

Year (x)Rural Household (y%)Urban Household (y%)
202026
202137
202239
2023415
2024520

Based on the above data, which of the following statements are correct?

(A) A straight line trend by the method of the least squares for rural Indians is yty^t = 3.4 + 0.7 (x - 2022)

(B) A straight line trend by the method of the least squares for urban Indians is yty^t = 11.4 + 4.3 (x - 2022)

(C) The forecast for the year 2025 for urban group using the trend equation is 22.2 %.

(D) The forecast for the year 2025 for rural group using the trend equation is 5.5 %.

Choose the correct answer from the options given below:

Solution

Correct Option: 2

In the Method of Least Squares, the trend line equation is:

yt=a+b(X)y^t = a + b(X)

where X=xxˉX = x - \bar{x},   a=yn\;a = \dfrac{\sum y}{n},   b=XyX2\;b = \dfrac{\sum Xy}{\sum X^2}

Since there are 5 years (odd), the middle year 2022 is the origin, so X=x2022X = x - 2022.

This makes X=0\sum X = 0, which simplifies the calculations.


YearXXRural (y1y_1)Urban (y2y_2)X2X^2Xy1X \cdot y_1Xy2X \cdot y_2
2020−2264−4−12
2021−1371−3−7
2022039000
202314151415
2024252041040
Total0175710736

Statement (A) — Rural Trend Line:

a=175=3.4a = \dfrac{17}{5} = 3.4

b=710=0.7b = \dfrac{7}{10} = 0.7

yt=3.4+0.7(x2022)y^t = 3.4 + 0.7(x - 2022)

Statement (A) is correct. ✅


Statement (B) — Urban Trend Line:

a=575=11.4a = \dfrac{57}{5} = 11.4

b=3610=3.6b = \dfrac{36}{10} = 3.6

yt=11.4+3.6(x2022)y^t = 11.4 + 3.6(x - 2022)

Statement (B) claims b=4.3b = 4.3, but the correct value is 3.63.6.

Statement (B) is incorrect. ❌


Statement (C) — Urban Forecast for 2025:

yt=11.4+3.6(20252022)y^t = 11.4 + 3.6(2025 - 2022)

=11.4+3.6(3)= 11.4 + 3.6(3)

=11.4+10.8= 11.4 + 10.8

=22.2%= 22.2\%

Statement (C) is correct. ✅


Statement (D) — Rural Forecast for 2025:

yt=3.4+0.7(20252022)y^t = 3.4 + 0.7(2025 - 2022)

=3.4+0.7(3)= 3.4 + 0.7(3)

=3.4+2.1= 3.4 + 2.1

=5.5%= 5.5\%

Statement (D) is correct. ✅


Statements (A), (C) and (D) are correct.

The correct answer is Option 2.

Keyboard Shortcuts

  • Left arrow: Previous question
  • Right arrow: Next question
  • S key: Jump to solution
  • Q key: Jump to question