Prices of crude oil have been steadily rising over the last two years (The Wall Street Journal, December 14, 2010). The monthly data on price per gallon of unleaded regular gasoline in the United States from January 2009 to December 2010 were available. Three trend models were created starting with t = 1 and the following output was generated. Which of the following would be a difference in the forecasts for the price of regular unleaded gasoline for February 2011 comparing two trend models: cubic and quadratic?
A) $0.01
B) $0.02
C) $0.03
D) $0.04

Question

Prices of crude oil have been steadily rising over the last two years (The Wall Street Journal, December 14, 2010). The monthly data on price per gallon of unleaded regular gasoline in the United States from January 2009 to December 2010 were available. Three trend models were created starting with t = 1 and the following output was generated.  Which of the following would be a difference in the forecasts for the price of regular unleaded gasoline for February 2011 comparing two trend models: cubic and quadratic?
A) $0.01 
B) $0.02 
C) $0.03 
D) $0.04

Quizplus · Accepted Answer

The Answer of Prices of crude oil have been steadily rising over the last two years (The Wall Street Journal, December 14, 2010). The monthly data on price per gallon of unleaded regular gasoline in the United States from January 2009 to December 2010 were available. Three trend models were created starting with t = 1 and the following output was generated.  Which of the following would be a difference in the forecasts for the price of regular unleaded gasoline for February 2011 comparing two trend models: cubic and quadratic?
A) $0.01 
B) $0.02 
C) $0.03 
D) $0.04

Prices of Crude Oil Have Been Steadily Rising Over the Last