Chapter 6, Problem 458RE

For the following exercise, consider the stock market crash in 1929 in the United States. The table lists the Dow Jones industrial average per year leading up to the crash.

Years after 1920	Value($)
1	63.90
3	100
5	110
7	160
9	381.17

Source: http://stockcharts.com/freecharts/historical/ djia19201940.html

458. [T] The best-fit exponential curve to these data is given by $y=40.71+{1.224}^x$ . Why do you think the gains of the market were unsustainable? Use first and second derivatives to help justify your answer. What would this model predict the Dow Jones industrial average to be in 2014 ?