i. In a time series analysis, the letter "a" in the linear trend equation, is the value of when t = 0. ii. In the linear trend equation, t is any value that corresponds with a time period, i.e., month or quarter.
iii. If the sales, production or other data over a period of time tend to approximate a straight-line trend, the equation developed by the least squares method cannot be used to forecast sales for a future period.
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

i. In a time series analysis, the letter "a" in the linear trend equation, is the value of  when t = 0. ii. In the linear trend equation, t is any value that corresponds with a time period, i.e., month or quarter.
iii. If the sales, production or other data over a period of time tend to approximate a straight-line trend, the equation developed by the least squares method cannot be used to forecast sales for a future period.
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.

Quizplus · Accepted Answer

(i) and (ii) are both correct statements. The letter "a" in the linear trend equation represents the value of the dependent variable when the independent variable is zero, and t represents any time period. 
However, statement (iii) is incorrect. The least squares method can be used to develop a linear trend equation and forecast future periods even if the data tends to approximate a straight-line trend. In fact, the method is specifically designed for cases where the trend is linear.

I in a Time Series Analysis, the Letter "A" in the Linear