Question: Using the data from exercise 26, estimate a linear trend model with seasonal dummy variables to make forecasts for the first three months of 2011.

Using the data from exercise 26, estimate a linear trend model with seasonal dummy variables to make forecasts for the first three months of 2011.

Data From 26

Year................ Month................ Return (%)

2006.................... Jan........................ 4.65

2006.................... Feb........................ 4.73

⋮........................... ⋮ ..............................⋮

2010.................... Dec ........................4.16

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