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

question 64

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,the best interpretation of the constant 6.102 in the regression equation is:

• A)the fitted value for the first quarter of 2009,prior to seasonal adjustment,is log₁₀(6.102).
• B)the fitted value for the first quarter of 2009,after to seasonal adjustment,is log₁₀(6.102).
• C)the fitted value for the first quarter of 2009,prior to seasonal adjustment,is 10^6.102.
• D)the fitted value for the first quarter of 2009,after to seasonal adjustment,is 10^6.102.

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Definitions:

Olfactory Epithelium

The specialized tissue inside the nasal cavity involved in smell; it houses olfactory receptors that detect odors.

Hypothalamus

A small region of the brain that's crucial for hormone production and helps to regulate body temperature, mood, hunger, and sleep.

Amygdala Lesion

Damage to the amygdala, a part of the limbic system responsible for emotions, decision-making, and memory, which can affect emotion and behavior.

Olfactory Receptors

Olfactory receptors are specialized proteins in the nose responsible for detecting odor molecules, initiating the sense of smell.