Which of the Following Is True of the Linear Trend

question 109

Multiple Choice

Which of the following is true of the linear trend model?

• A) It assigns exponentially decreasing weights to older observations.
• B) It is a causal forecasting model.
• C) It can extract a long-term upward or downward steady movement in a series.
• D) It is used when a series involves only random fluctuations.

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Definitions:

Initial Investment

The amount of money used to start a business venture, acquire an asset, or invest in a financial product.

Short 100 Shares

The selling of 100 shares that are not currently owned, with the expectation of buying them back at a lower price for a profit.

Initial Margin

The minimum amount of capital required to open a new position in the market, designed as a security for the broker against potential losses.

Actual Margin

The real profit margin achieved after accounting for all costs and expenses, reflecting the actual financial health and profitability.