Redo question 28, this time using only data from 1978 to 1987. Does your answer to part

(c) change? If so, account for this result.

Question 28

Use MINITAB and the data given in question 27 and the equations given in question 26.

(a) Draw a graph showing the actual amount of sales and the estimate of sales based on equation A.

(b) Draw a graph showing the actual amount of sales and the estimate of sales based on equation B.

(c) Referring to the graphs you drew in parts

(a) and (b), compare the two models used for forecasting. Which model does a better job?

Question 27

Suppose you are given the following data for Abbott Laboratories sales.

Use MINITAB to do the following:

(a) Use model A from question 26 to estimate the relationship between sales and time (t).

(b) Use model B from question 26 to estimate the relationship among sales, time (t), and the square of time (t²).

Question 26

In order to forecast the value of a variable, we sometimes use a nonlinear trend regression such as

where t = time. Briefly explain why this model may be better than a model such as

Transcribed Image Text:

Year 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 Sales 351.0 403.9 457.5 458.1 521.8 620.4 765.4 940.6 1084.8 1244.9 Year 1978 1978 1980 1981 1982 1983 1984 1985 1986 1987 Sales 1467.6 1683.2 2038.2 2342.5 2602.4 2927.9 3104.0 3360.3 3870.7 4387.9