Reference no: EM133304713
Instruction
The Cost of a Postage Stamp-Consider the following data. Use the procedures in this chapter to capture the trend of the data if one exists. Would you eliminate any data points? Why? Would you be willing to use your model to predict the price of a postage stamp on January 1, 2010? What do the various models you construct predict about the price on January 1, 2010? When will the price reach $1? You might enjoy reading the article on which this problem is based: Donald R. Byrkit and Robert E. Lee, ‘‘The Cost of a Postage Stamp, or Up, Up, and Away,'' Mathematics and Computer Education 17, no. 3 (Summer 1983): 184-190.
The Cost of a Postage Stamp-Consider the following data.
|
Date
|
Base year
|
First-class stamp
|
Comments
|
|
|
x
|
y($)
|
|
|
1885-1917
|
0
|
0.02
|
|
|
1917-1919
|
1
|
0.03
|
(Wartime increase)
|
|
1919
|
2
|
0.02
|
(Restored by Congress)
|
|
July 6, 1932
|
3
|
0.03
|
|
|
August 1, 1958
|
4
|
0.04
|
|
|
January 7, 1963
|
5
|
0.05
|
|
|
January 7, 1968
|
6
|
0.06
|
|
|
May 16, 1971
|
7
|
0.08
|
|
|
March 2, 1974
|
8
|
0.1
|
|
|
December 31, 1975
|
9
|
0.13
|
(Temporary)
|
|
July 18, 1976
|
10
|
0.13
|
|
|
May 15, 1978
|
11
|
0.15
|
|
|
March 22, 1981
|
12
|
0.18
|
|
|
November 1, 1981
|
13
|
0.2
|
|
|
February 17, 1985
|
14
|
0.22
|
|
|
April 3, 1988
|
15
|
0.25
|
|
|
February 3, 1991
|
16
|
0.29
|
|
|
January 1, 1995
|
17
|
0.32
|
|
|
January 10, 1999
|
18
|
0.33
|
|
|
January 7, 2001
|
19
|
0.34
|
|
|
June 30, 2002
|
20
|
0.37
|
|
|
January 8, 2006
|
21
|
0.39
|
|
|
May 14, 2007
|
22
|
0.41
|
|
|
May 12, 2008
|
23
|
0.42
|
|
|
May 11, 2009
|
24
|
0.44
|
|
|
January 22, 2012
|
25
|
0.45
|
|
Use the procedures in this chapter to capture the trend of the data if one exists.
Question 1: Would you eliminate any data points? Why?
Question 2: Would you be willing to use your model to predict the price of a postage stamp on January 1, 2010?
Question 3: What do the various models you construct predict about the price on January 1, 2010?
Question 4: When will the price reach $1?