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

question 124

Multiple Choice

SCENARIO 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 2009 to 2013.The following is the resulting regression equation:
log₁₀ Y^ˆ = 6.102 + 0.012 X - 0.129 Q₁ - 0.054 Q₂ + 0.098 Q₃
where
Y^ˆ 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.
Q₃ is a dummy variable equal to 1 in the third quarter of a year and 0 otherwise.
Time-Series Forecasting 16-31
-Referring to Scenario 16-12,in testing the significance of the coefficient of X in the regression equation (0.012) which has a p-value of 0.0000.Which of the following is the best interpretation of this result?

• A)The quarterly growth rate in revenues is significantly different from 0% ( α = 0.05).
• B)The quarterly growth rate in revenues is not significantly different from 0% ( α = 0.05).
• C)The quarterly growth rate in revenues is significantly different from 1.2% ( α = 0.05).
• D)The quarterly growth rate in revenues is not significantly different from 1.2% ( α = 0.05).

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Definitions:

Crossed Extensor Reflex

A reflex action in which the extension of one limb is paired with the flexion of the contralateral limb.

Common Fibular Nerve

A branch of the sciatic nerve that innervates the muscles of the lower leg, contributing to foot and toe movement and sensation.

Medial Plantar Nerves

Nerves that supply sensation and muscle control to the medial part of the bottom of the foot.

Lateral Plantar Nerves

Nerves that innervate the lateral aspect of the bottom of the foot, playing a key role in sensory and motor functions.