The Pyramids of Giza Are One of the Most Visited

question 34

Essay

The Pyramids of Giza are one of the most visited monuments in Egypt. The number of visitors per quarter has been recorded (in thousands) as shown in the accompanying table: $$\begin{array}{l}\text { Year }\\\begin{array} { | l | c c c c | } \hline \text { Quarter } & 1995 & 1996 & 1997 & 1998 \\\hline \text { WTinter } & 210 & 215 & 218 & 220 \\\text { Spring } & 260 & 275 & 282 & 290 \\\text { Summer } & 480 & 490 & 505 & 525 \\\text { Autumn } & 250 & 255 & 265 & 270 \\\hline\end{array}\end{array}$$ a. Plot the time series.
b. Discuss why exponential smoothing is not recommended as a forecasting method in this case.
c. Calculate the four-quarter centred moving averages.
d. Use the moving averages computed in (c) to calculate the seasonal (quarterly) indexes.
e. Use the seasonal indexes computed in (d) to deseasonalise the original time-series data, and plot the deseasonalised time series.
f. Use regression analysis to develop the trend line.
g. Use the seasonal indexes calculated in (d) and the linear trend calculated in (f) to forecast the number of visitors in the next four quarters and describe the seasonal fluctuations in the number of visitors.

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Definitions:

Financial Covenant

A clause in a loan agreement that requires the borrower to meet certain financial conditions, often used by lenders to protect their investments.

Net Worth

The total value of assets owned by an individual or corporation, minus any liabilities, indicating financial health.

Working Capital

Working capital is the difference between a company's current assets and current liabilities, indicating the liquidity and operational efficiency of the business.

Debt Covenants

Agreements or conditions included in debt contracts that the borrower must adhere to, designed to protect the lender by restricting the borrower’s activities and enhancing the likelihood of debt repayment.