SCENARIO 16-12
a Local Store Developed a Multiplicative Time-Series Model $$\log _ { 10 } \hat { Y } = 6.102 + 0.012 X - 0.129 Q _ { 1 } - 0.054 Q _ { 2 } + 0.098 Q _ { 3 }$$

question 114

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: $$\log _ { 10 } \hat { Y } = 6.102 + 0.012 X - 0.129 Q _ { 1 } - 0.054 Q _ { 2 } + 0.098 Q _ { 3 }$$
where $\hat { Y }$ is the estimated number of contracts in a quarter
$X$ is the coded quarterly value with $X = 0$ in the first quarter of 2008 .
$Q _ { 1 }$ is a dummy variable equal to 1 in the first quarter of a year and 0 otherwise.
$Q _ { 2 }$ is a dummy variable equal to 1 in the second quarter of a year and 0 otherwise.
$Q _ { 3 }$ is a dummy variable equal to 1 in the third quarter of a year and 0 otherwise.
-Referring to Scenario 16-12, the best interpretation of the coefficient of Q3 (0.098) in the regression equation is:

• A) the revenues in the third quarter of a year is approximately 9.8% higher than the average over all 4 quarters.
• B) the revenues in the third quarter of a year is approximately 9.8% higher than it would be during the fourth quarter.
• C) the revenues in the third quarter of a year is approximately 25.31% higher than the average over all 4 quarters.
• D) the revenues in the third quarter of a year is approximately 25.31% higher than it would be during the fourth quarter.

Analyze the effects of taxes on the demand and supply of land.

Explain the relationship between interest rates, inflation, and real returns on investments.

Grasp the principles of loan interest calculations and the impact of interest compounding.

Recognize the implications of land supply inelasticity on the economy.

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Definitions:

Adolescence

A developmental stage that occurs between childhood and adulthood, marked by significant physical, psychological, and social changes.

Conflicts With Parents

Disagreements or disputes between children and their parents, often arising from differences in opinions, desires, or values.

Autonomy

The capacity to make an informed, uncoerced decision; in psychology, it often refers to the sense of self-governance and independence.

Menarche

The first occurrence of menstruation in a female, marking the onset of reproductive capability.