Examples 6.9.2(ii) · Example 12
Q.
Based on the data available for the sales of an item in a district, by the method of least squares
- tabulate the trend values
- find the best fit for a straight-line trend
- compute expected sale trend for year 2002
| Year | 1996 | 1997 | 1998 | 1999 | 2000 | 2001 |
|---|---|---|---|---|---|---|
| Sales (In lakh ₹) | 6.5 | 5.3 | 4.3 | 6.1 | 5.6 | 7.8 |
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Start your 14-day free trial to unlock the full solution →Fit with in half-year units about the mid-point 1998.5; , then extrapolate to 2002 () to get about ₹6.85 lakh.
= sales (lakh ₹); with an even number of years, is taken in half-year units from the mid-point so that .
- Set up the table ( in half-year units, origin 1998.5):
| Year | ||||
|---|---|---|---|---|
| 1996 | 6.5 | 25 | ||
| 1997 | 5.3 | 9 | ||
| 1998 | 4.3 | 1 | ||
| 1999 | 6.1 | 1 | ||
| 2000 | 5.6 | 9 | ||
| 2001 | 7.8 | 25 | ||
| Total |
-
Constants: and .
-
(ii) Best-fit straight-line trend: (x in half-year units from 1998.5).
-
(i) Tabulate the trend values:
| Year | ||
|---|---|---|
| 1996 |
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