Linear Trend of Sales

The linear trend of sales of a company can be analyzed using a trend equation. In this case, the sales of the company in 1995 were 650000, and the sales rise by 16500 per year.

Calculating the Trend Equation

To calculate the trend equation, we can use the formula:

y = a + bx

where y is the sales, x is the year, a is the intercept, and b is the slope.

Given that the sales in 1995 were 650000, we can write:

650000 = a + b(1995)

This gives us one equation with two unknowns. However, we also know that the sales rise by 16500 per year. This means that the slope of the trend line is 16500.

So we have two equations:

650000 = a + b(1995)

16500 = b

Solving for a and b, we get:

a = 318750

b = 16500

Therefore, the trend equation is:

y = 318750 + 16500x

where x is the year.

Interpreting the Trend Equation

The trend equation tells us that the sales of the company are increasing by 16500 per year. The intercept of 318750 tells us that in the absence of any year-to-year increase, the sales would be 318750.

Using the trend equation, we can also make predictions about future sales. For example, we can use the equation to estimate the sales in 2020:

y = 318750 + 16500(2020)

y = 1011750

Therefore, we can predict that the sales of the company in 2020 will be 1011750.

Conclusion

In conclusion, the linear trend of sales of a company can be analyzed using a trend equation. In this case, the trend equation is y = 318750 + 16500x, where x is the year. The equation tells us that the sales of the company are increasing by 16500 per year, and we can use the equation to make predictions about future sales.