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.

Question

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

Answer 1

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