An investor wants to invest in a mutual fund. She is hoping that the long-term trend for the fund will be increasing. She has data on the mutual fund price collected each month for the years 2016 and 2017. The date and the price are presented in Table 12.11.

a. Run a linear trend model on the price of the mutual fund for 2016.

b. Run a quadratic trend model on the price of the mutual fund for 2016.

c. Run a linear trend model on the price of the mutual fund for 2017.

d. Run a quadratic trend model on the price of the mutual fund for 2017.

e. Run a linear trend model on the price of the mutual fund for both years combined.

f. Run a quadratic trend model on the price of the mutual fund for both 2016 and 2017 combined.

g. Which of these models best fit the data?

h. Using the best fitting model, forecast the price for the 3 months of 2018.

Table 12.11

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Mutual Fund Prices for a 2-Year Period 2017 Jan 69.96 68.38 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 72.49 69.24 69.17 69.08 67.74 68.70 70.80 66.10 69.23 67.50 2016 60.23 62.94 64.17 67.56 67.92 66.03 67.34 70.64 66.25 68.43 67.15 67.76