AG HBU Part 4 Basic Trend Analysis Techniques

Question 1

For the following data series, what statistical analysis is likely to be most helpful in predicting the next few years, and why?

A. graphing and regression analysis
B. measures of central tendency
C. short-trend analysis
Why:

Answer 1

B. measures of central tendency
Why: Because there is no apparent trend over time

Course handbook guidance: Part 4, item III.B

Question 2

For the following data series, what statistical analysis is likely the most helpful in predicting the next few years if a new freeway interchange opened two years ago, and why?
A. graphing and regression analysis
B. measures of central tendency
C. short-trend analysis
Why?

Answer 2

C. short-trend analysis
Why: Because an external force (new freeway interchange) can be credited with the recent change

Course handbook guidance: Part 4, item VII.C

Question 3

Based on the data series below, what is the projected third year absorption using central tendency?
A. $975 to $1,045
B. $995 to $1,008
C. $1,000
D. $1,008

Answer 3

B. $995 to $1,008
(Mean = $1,008, Median = $1,000, Mode = $995)

Course handbook guidance: Part 4, item III.B

Question 4

Based on the data series below, what is the projected fifth year absorption using regression analysis? (Answer is rounded to the nearest whole unit.)

A. 118
B. 120
C. 125
D. 127

Answer 4

C. 125

Course handbook guidance: Part 4, item VI

Question 5

Based on the data series below (same as Question 18), what is the projected second year absorption using the short trend of the last two years?

A. $102
B. $109
C. $115
D. $120

Answer 5

D. $120
(Change is $5.00 per year. $110 + $5.00 + $5.00 = $120)

Course handbook guidance: Part 4, item VII

Question 6

An appraiser analyzing the following statistics notes that the average home price increased at a faster rate in the past two years than in the previous four years, but the cause is not apparent. Which of the following is an argument against the use of short trend to predict the change in home prices over the next two years?

A. change in external forces that would have influenced the change has not been identified.
B. The change rate in the past two years is only moderately higher than the previous four years.
C. The reliability of regression analysis is increased when there are more data points.
D. There is no recognizable pattern in the change rates.

Answer 6

A. change in external forces that would have influenced the change has not been identified.

Course handbook guidance: Part 4, item VII

Question 7

The formula for a straight-line relationship can be expressed by the formula y = a + bx. In the boxes below, indicate which symbol in the formula is being described (a, b, x, or y):
A. The slope (the coefficient of the independent variable)
B. The y intercept (value of y when x is zero)
C. The dependent variable
D. The independent variable

Answer 7

A. a (I think this is wrong and should be b)
B. a
C. y
D. x

Course handbook guidance: Part 4, item V.B

Question 8

The data set below tracks leasing of office space in a market area over 8 years. The first step in determining the utility of the data set to project the future is to explore its measures of central tendency.

A. Calculate the mean
B. Calculate the median

Answer 8

A. using the formula: x = Ex / n
=90,000+100,000+110,000+115,00+115,000+125,000+129,000+150,000
= 934,000 / 8 = 116,750

You can also use your calculator to find the mean a different way (retain the register information to use in calculating other statistics with the same data)

See pic for HP 12 Keystrokes

B.
= 8 +1 2
= midway between the 4th and 5th items in the array
= since both the 4th and 5th items are 115,000, the median is 115,000.

Question 9

A. Using the data in 4.2 Problem, project the new space leased over the next five years using the mean, median, and mode.
B. Is any characteristic of the data set not identified by any of the central tendencies?

Answer 9

A. Mean: The mean was calculated to be 116,750, indicating that an additional 116,750 sq. ft. of space would be leased each year over the next five years.
Median: The median was determined to be 115,000, indicating that an additional 115,000 sq. ft. of space would be leased each year over the next five years.
Mode: The mode is 115,000, indicating that an additional 115,000 sq. ft. of space would be leased over the next five years.

B. Yes; the measures of central tendency do not inform us of recent trends. There is an upward trend in new space leased over the eight- year time frame.

Question 10

The three measures of central tendency area xxx , xxx , and xxx.

Answer 10

mean, median, mode

Review Quiz

Question 11

Calculating or estimating a quantity beyond the range of data on which the calculation or estimate is based is xxx .

Answer 11

extrapolation

Review Quiz

Question 12

The two measures of dispersion are xxx and xxx xxx .

Answer 12

range
standard deviation

Review Quiz

Question 13

In conducting market analysis, an analyst uses xxx to
understand and project market behavior.

Answer 13

inferential statistics

Review Quiz

Question 14

Inferential statistics allows the analyst to draw conclusions about a xxx based on a xxx .

Answer 14

population
sample

Review Quiz

Question 15

With a normal distribution, the data is distributed xxx .

Answer 15

evenly around the mean

Review Quiz

Question 16

In graphing analysis, the horizontal axis is associated with the xxx xxx and is identified as the ? axis.

Answer 16

independent variable
x

Review Quiz

Question 17

In graphing analysis, the vertical axis is associated with the xxx xxx and is identified as the ? axis.

Answer 17

dependent variable
y

Review Quiz

Question 18

A data point (observation) that is much larger or smaller than the others in the sample is an xxx .

Answer 18

outlier

Review Quiz

Question 19

Central Tendency =
Can be measured in …

Answer 19

Average
… tree ways: mean, median, mode.

Question 20

Causal variable =

Answer 20

independent variable