SCENARIO 16-14 a Contractor Developed a Multiplicative Time-Series Model to Forecast the Forecast

question 104

Multiple Choice

SCENARIO 16-14
A contractor developed a multiplicative time-series model to forecast the number of contracts in future quarters,using quarterly data on number of contracts during the 3-year period from 2011 to 2013.The following is the resulting regression equation:
ln Y^ˆ = 3.37 + 0.117 X - 0.083 Q₁ + 1.28 Q₂ + 0.617 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 2011.
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.
-Referring to Scenario 16-14,to obtain a forecast for the first quarter of 2014 using the model,which of the following sets of values should be used in the regression equation?

• A)X = 12,Q₁ = 0,Q₂ = 0,Q₃ = 0
• B)X = 12,Q₁ = 1,Q₂ = 0,Q₃ = 0
• C)X = 13,Q₁ = 0,Q₂ = 0,Q₃ = 0
• D)X = 13,Q₁ = 1,Q₂ = 0,Q₃ = 0

---

Definitions:

Facilitating Function

Activities that assist in the movement of goods from the producer to the consumer, including transportation, storage, and financial services.

Channel Intermediaries

Organizations or individuals that act as middlemen in the distribution process, helping to move products from the manufacturer to the consumer.

Direct Channel

A method of distribution where a company sells its products or services directly to consumers without the use of intermediaries.

Producers

Entities or individuals that create, manufacture, or supply goods and services for consumption by consumers or other businesses.