A Firm Uses Trend Projection and Seasonal Factors to Simulate $\begin{array}{llcc}0&1&0&2&0&0&0&1&0&3&2&0&0&0&0&2&1&2&3&1&2&0&2&0&3&0&0&2&1&0&1\end{array}$

question 67

Multiple Choice

A firm uses trend projection and seasonal factors to simulate sales for a given time period. It assigns "0" if sales fall, "1" if sales are steady, "2" if sales rise moderately, and "3" if sales rise a lot.
The simulator generates the following output. $\begin{array}{llcc}0&1&0&2&0&0&0&1&0&3&2&0&0&0&0&2&1&2&3&1&2&0&2&0&3&0&0&2&1&0&1\end{array}$
Estimate the probability that sales will rise moderately.

• A) 0.312
• B) 0.226
• C) 0.258
• D) 0.233

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Definitions:

AMTI

Alternative Minimum Taxable Income, which is calculated to ensure that taxpayers with large amounts of deductions, exemptions, and exclusions still pay a minimum amount of tax.

AMT Depreciation

Depreciation methods and rates that apply for the Alternative Minimum Tax, a parallel tax system to ensure certain taxpayers pay a minimum amount of tax.

Regular Tax Depreciation

A deduction that allows taxpayers to recover the cost of property used in a business or held for the production of income, computed under the regular tax system.

Real Property

Land and anything permanently attached to it, such as buildings and structures, classified as immovable by law.