1. Trend in an exponential trend model is also known as:

	a.	Percentage seasonality
	b.	Exponential Seasonality
	c.	Exponential growth
	d.	Percentage growth

2. An analyst ran three models as following with the respective training and validation periods error values:

1. Linear Trend; Training Period RMSE = 1246.43, Validation Period RMSE = 2130.43

2. Exponential Trend + Seasonality: Training Period RMSE = 643.44, Validation Period RMSE = 690.88

3. Polynomial Trend + Seasonality: Training Period RMSE = 689.09, Validation Period RMSE = 603.78

Based on the above information, please select the right statement below:

	a.	Exponential Trend + Seasonality model has learned the systematic components better than others
	b.	Polynomial Trend + Seasonality model has learned the systematic components better than others
	c.	Linear model has learned the systematic components better than others
	d.	None of the above statements are correct.

3. The following graph shows a time plot of the seasonally adjusted Revenue of airlines.

Which of the following methods would be adequate for forecasting this series?

		1. Linear regression model with dummy variables
		2. Linear regression model with trend
		3. Linear regression model with dummy variables and trend
		4. None of the above

Seasonally-Adjusted Air Revenue Passenger Miles ($billions) o 50 Jan-90 Jan-91 w Jan-92 Jan-93 Jan-94 Jan-95 Month Jan-96 Jan-97 Jan-98 Jan-99 Jan-00 Jan-01 Seasonally-Adjusted Air Revenue Passenger Miles ($billions) o 50 Jan-90 Jan-91 w Jan-92 Jan-93 Jan-94 Jan-95 Month Jan-96 Jan-97 Jan-98 Jan-99 Jan-00 Jan-01