TABLE 16-12 A Local Store Developed a Multiplicative Time-Series Model to Forecast

question 18

Short Answer

TABLE 16-12
A local store developed a multiplicative time-series model to forecast its revenues in future quarters,using quarterly data on its revenues during the 5-year period from 2008 to 2012.The following is the resulting regression equation:
log₁₀
= 6.102 + 0.012 X - 0.129 Q₁ - 0.054 Q₂ + 0.098 Q₃
where is the estimated number of contracts in a quarter
X is the coded quarterly value with X = 0 in the first quarter of 2008
Q₁ is a dummy variable equal to 1 in the first quarter of a year and 0 otherwise
Q₂ is a dummy variable equal to 1 in the second quarter of a year and 0 otherwise is a dummy variable equal to 1 in the third quarter of a year and 0 otherwise
-Referring to Table 16-12,using the regression equation,what is the forecast for the revenues in the fourth quarter of 2014?

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Definitions:

Simultaneous Game

A strategic game where all players make their decisions or moves at the same time without knowing their opponents' actions.

Best Response

In game theory, it is the strategy that yields the highest payoff for a player, given the strategies chosen by other players.

Nash Equilibrium

A concept in game theory where each player's strategy is optimal, given the strategies of all other players, resulting in no incentive for unilateral shifts.

Game of Chicken

A game theory model where two players head towards each other on a collision path; the one who swerves is considered 'chicken,' but if neither swerves, both face disastrous outcomes.