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Which of the following statements are correct?

A. If x1,x2,x3,…,xnx_1,x_2,x_3,\dots,x_n is the given annual time series, then 3-yearly moving averages are x1+x2+x33,x2+x3+x43,……\dfrac{x_1+x_2+x_3}{3},\dfrac{x_2+x_3+x_4}{3},\dots\dots

B. In the method of the least squares, if (t1,y1),(t2,y2),…(tn,yn)(t_1,y_1),(t_2,y_2),\dots(t_n,y_n) denote the time series and yty_t are trend values of yy, then ∑(y−yt)=0\sum(y-y_t)=0

C. In the method of the least squares, the sum of squares of the deviations of the values of yy from their corresponding trend values is least.

D. The rise in prices before Diwali is an example of a cyclical trend.

Choose the correct answer from the options given below:

Solution

✅ Correct Option: 1

A and C restate the definitions of moving averages and of least squares correctly, and B is the standard property that residuals about the fitted trend sum to zero. D fails, because a price rise tied to Diwali recurs within each year, making it a seasonal variation rather than a cyclical one.

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