13.6 Exercise 5

An economist is interested in the possible influence of "Miracle Wheat" on the average yield of wheat in a district. To do so they fit a linear regression of average yield per year against year after introduction of "Miracle Wheat" for a ten year period.

The fitted trend line is

$\overset{^}{y}_{j} = 80 + 1.5 \cdot X_{j}$

($Y_{j}$: Average yield in j year after introduction)

($X_{j}$: j year after introduction).

1. What is the estimated average yield for the fourth year after introduction?
2. Do you want to use this trend line to estimate yield for, say, 20 years after introduction? Why? What would your estimate be?