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

question 5

Multiple Choice

TABLE 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 4-year period from 2005 to 2009. The following is the resulting regression equation:
log₁₀ = 6.102 + 0.012 X - 0.129 Q₁ - 0.054 Q₂ + 0.098 Q₃
where is the estimated number of contracts in a quarter.
X is the coded quarterly value with X = 0 in the first quarter of 2005.
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.
-Referring to Table 16-12, the best interpretation of the coefficient of X (0.012) in the regression equation is

• A) the quarterly compound growth rate in revenues is around 2.8%.
• B) the annual growth rate in revenues is around 2.8%.
• C) the quarterly growth rate in revenues is around 1.2%.
• D) the annual growth rate in revenues is around 1.2%.

Comprehend the implications and outcomes of the deregulation of various industries.

Analyze the effect of corporate concentration and mergers on the economy and competition.

Explain the concept of different types of mergers and their strategic purposes.

Understand the characteristics and behaviors of oligopolistic firms.

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Definitions:

Lead Time

The period between the initiation of a process and its completion, especially in manufacturing or project planning.

Memory Chips

Small hardware components used for storing data or code in electronic devices.

EOQ

Stands for Economic Order Quantity, a formula used to determine the optimal order size that minimizes total holding costs and ordering costs in inventory management.

Ordering Costs

Expenses incurred in placing and receiving orders from suppliers, including costs associated with ordering processing and inspections.