Consider the Following Linear Trend Equation of an Industry's Sales

Multiple Choice

Consider the following linear trend equation of an industry's sales: yt = 120 + 12 xt,where t is the time index (t = 1,2,... ,n) and yt is annual sales (in millions of dollars) .Which is the most reasonable conclusion?

A) We would forecast that sales will increase $12 million in the next year.
B) We would forecast that sales will increase 12 percent in the next year.
C) On the average,sales will increase 12/(120 + 12 × 10) = 0.05,or 5 percent next year.
D) The year-to-year average change will depend on the value of t.