$1.$ Exploring Finance: Linear Trend Forecasting

$1.$ In Year $3,$ what are the forecast sales for Year $4?$

$$2,058$

$$3,010$

$$2,769$

$$3,243$

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$2.$ The forecast for Year $2($made in Year $1)$ jumps from $$2,058$ to a forecast of $$3,010$ for Year $3($made in Year $2).$ The change is so large because

Regression predictions can be misleading and unstable when there are few data points.

The largest year$-$to$-$year change in actual sales was from Year $1$ to Year $2.$

Both of the above reasons are correct.

Neither of the first two reasons is correct.