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

question 115

Short Answer

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,using the regression equation,what is the forecast for the revenues in the third quarter of 2014?

---

Definitions:

Otoscopic Examination

A visual examination of the ear canal and eardrum using an otoscope, an instrument designed for looking into the ear canal.

Injected Membrane

Typically refers to a membrane or tissue that appears red due to an increased blood supply, often as a response to inflammation or infection.

Oblique Position

A body position where the individual is lying on their side with the body angled so that the front is neither completely exposed nor completely hidden.

Thick and Opaque

Descriptive terms indicating something dense and not allowing light to pass through, often used in reference to materials or fluids.