i. In the linear trend equation, the letter "b" is the average change in t for each change of one unit (either increase or decrease) in y. ii. The least squares method of computing the equation for a straight line going through the data of interest gives the "best fitting" line.
iii. A straight-line trend equation is used to represent the time series when it is believed that the data is increasing(or decreasing) by equal amounts, on the average, from one period to another.
A) (i), (ii), and (iii) are all correct statements.
B) (i) and (ii) are correct statements but not (iii).
C) (i) and (iii) are correct statements but not (ii).
D) (ii) and (iii) are correct statements but not (i).
E) (i), (ii), and (iii) are all false statements.

Question

Quizplus · Accepted Answer

Statement (i) is incorrect because in the linear trend equation, "b" represents the slope of the line, which is the average change in the dependent variable (often denoted as "y") for each one-unit increase in the independent variable (often denoted as "x"), not the other way around. Statements (ii) and (iii) are correct; the least squares method does indeed provide the "best fitting" line by minimizing the sum of the squares of the vertical distances of the points from the line, and a straight-line trend equation is used when data is believed to increase or decrease by equal amounts over time.

I in the Linear Trend Equation, the Letter "B" Is