# Economics

posted by
**Adam** on
.

The table below shows annual demand (in 100,000 units per year) for Widgets. Use this information to calculate a linear trend forecasting model using regression analysis. Use your trend estimate to forecast demand for the years 1995 and 2000.

Year Demand

1990 1

1991 4

1992 5

1993 8

Being as my profession decides to spring questions on us that he hasn't taught, I'm at a loss on how to approach this problem, let alone solve it.

Any help is greatly appreciated.

The regression equation is Y=-1+2.2t

where Y=the output and t is the time. Hence the demand for1995 is

Y=-1+(2.2).6=-1+13.2=12.2=12(approx.)

the demand in 2000 is

Y=-1+(2.2).11=-1+24.2=-1+24.2=23.2=23 (approx.)