Consider the following data:
| Year (x) | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 |
| Profit (Rs.)(y) | 114 | 130 | 126 | 144 | 138 | 156 | 164 |
The equation of straight line trend by using least square method is, \(y = 138.86 + 7.64(x - 2007)\), then the trend values for the year 2004 is
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → 115.94
The trend value for a year is found by putting that year into the given trend equation. For 2004, \(x - 2007 = -3\):
\(y = 138.86 + 7.64 \times (-3)\)
\(y = 138.86 - 22.92\)
\(y = 115.94\)