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Basic Question 3 of 9
A linear trend for time series data beginning in 2006 and extending up through 2011 (data for 6 years) is Y-hat = 5.2 + 3.1t. The forecast for 2012 is
B. 26.9
C. 30.0
A. 23.8
B. 26.9
C. 30.0
User Contributed Comments 3
| User | Comment |
|---|---|
| vi2009 | got tricked! forecast for 2012 ... so t = 7 |
| jazzguitar | I don't understand why t = 7. 2006 = 0 2007 = 1 2008 = 2 2009 = 3 2010 = 4 2011 = 5 2012 = 6 ? |
| myron | @jazzguitar: 2006 is year 1. |
I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach
Learning Outcome Statements
calculate and evaluate the predicted trend value for a time series, modeled as either a linear trend or a log-linear trend, given the estimated trend coefficients;
describe factors that determine whether a linear or a log-linear trend should be used with a particular time series and evaluate limitations of trend models;
explain the requirement for a time series to be covariance stationary and describe the significance of a series that is not stationary;
CFA® 2025 Level II Curriculum, Volume 1, Module 5.