Question
The graph and table below give the monthly principal and interest payments for a mortgage from 1999 to 2004. Use this information to predict the payment for2005.
year Payment
1999 $578
2000 613
2001 654
2002 675
2003 706
2004 730
2005
how do I fugure this out? I know I do something withall the differences but don't know what
year Payment
1999 $578
2000 613
2001 654
2002 675
2003 706
2004 730
2005
how do I fugure this out? I know I do something withall the differences but don't know what
Answers
It is unclear to me why a mortgage payment would be steadily rising from year to year. No wonder the economy is such a mess!
You are probably right in thinking they expect you to use first or second differences to "extrapolate"
Let's complete the table.
1999 $578
----------35 <- first differences
2000 613 ... 6 <--2nd differences
----------41
2001 654 ... -20
----------21
2002 675 ... 10
----------31
2003 706 ... -7
----------24
2004 730 ... -3
----------21
2005 751
It makes no sense to me why the payment increase would go up some years and down in others. There is no sort of discernible trend. I chose to average the second differnces to predict the first difference between 2004 and 2005
You are probably right in thinking they expect you to use first or second differences to "extrapolate"
Let's complete the table.
1999 $578
----------35 <- first differences
2000 613 ... 6 <--2nd differences
----------41
2001 654 ... -20
----------21
2002 675 ... 10
----------31
2003 706 ... -7
----------24
2004 730 ... -3
----------21
2005 751
It makes no sense to me why the payment increase would go up some years and down in others. There is no sort of discernible trend. I chose to average the second differnces to predict the first difference between 2004 and 2005