Final answer:
A common technique for predicting future values from past data is using extrapolation methods like trend analysis or least-squares regression, though unpredictable events can make precise forecasting difficult.
Step-by-step explanation:
A common technique for predicting a future value on the basis of a time series of past values is extrapolation using methods such as trend analysis or least-squares regression. In trend analysis, analysts identify patterns in historical data that can suggest future outcomes. For example, 'Netflix' uses data about its users' past viewing habits to make predictions about their future viewing behavior. Economists may make use of a list of expected points on the stock market index to predict outcomes over the next weeks and compare it with actual market performance. However, the unpredictability of future events, such as shifts in expectations about profits, makes accurate forecasting challenging, as stock prices can follow a 'random walk with a trend,' indicating that, while stock prices may fluctuate randomly on a day-to-day basis, they show an overall upward trend over time. The least-squares regression technique can be applied after determining the presence of a strong correlation coefficient between variables to make more precise predictions about data trends.