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

question 117

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^ˆis 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,in testing the coefficient for Q₁ in the regression equation (- 0.083) ,the results were a t-statistic of - 0.66 and an associated p-value of 0.530.Which of the following is the best interpretation of this result?

Definitions:

Absorption Costing

A pricing strategy that incorporates all costs associated with production, including both variable and fixed expenses, into the product's cost.

Absorption Costing

The accounting methodology that integrates all costs related to manufacturing, including direct materials, direct labor, and both forms of manufacturing overhead—variable and fixed—into a product's total cost.

Variable Costing

A financial tracking method that considers just the variable operating costs (direct materials, direct labor, and variable manufacturing overhead) in the pricing of merchandise.

Unit Product Cost

The overall expense incurred to manufacture a single item, encompassing direct materials, direct labor, and overhead costs.