Which of the following settings constitutes an interpolation?
A) Using past sales, and price information to make a forecast for next year's sales growth.
B) Using past sales, and price information to estimate last year's price elasticity of demand.
C) Using 2014 and 2016 data on GDP to estimate GDP in the third quarter of 2015, which is missing.
D) Using a randomized control trial to estimate the causal effect of the use of a cancer treatment on health outcomes.

Question

Quizplus · Accepted Answer

Interpolation involves estimating a missing value within a known range of values, which is what is happening in option C, where GDP for the missing quarter is being estimated based on GDP data from surrounding years. Options A, B, and D all involve prediction or estimation outside of a known range of values, which would be considered extrapolation.

Which of the Following Settings Constitutes an Interpolation