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

question 179

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
-Referring to Scenario 16-14, in testing the coefficient of X in the regression equation (0.117) the results were a t-statistic of 9.08 and an associated p-value of 0.0000. Which of the
Following is the best interpretation of this result?

• A) The quarterly growth rate in the number of contracts is significantly different from 0% (α = 0.05).
• B) The quarterly growth rate in the number of contracts is not significantly different from 0% (α = 0.05).
• C) The quarterly growth rate in the number of contracts is significantly different from 100% (α = 0.05).
• D) The quarterly growth rate in the number of contracts is not significantly different from 100% (α = 0.05).

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Definitions:

Income Tax Obligation

The amount of money a person or entity is legally required to pay to the government based on their taxable income.

Historical Tax Rates

Past tax rates that have been applied to individuals or corporations, which can indicate trends and policy changes.

Deferred Tax Liability

A tax obligation that a company owes in the future due to timing differences between its taxable income and its accounting income.

Accelerated Depreciation

A method of depreciation that allows a business to write off the cost of an asset more quickly in the early years of its useful life.