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

question 76

Short Answer

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, using the regression equation, what is the forecast for the revenues in the first quarter of 2012?

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Definitions:

Subliminal Perception

The process of receiving information below the level of conscious awareness, which can influence thoughts, feelings, or actions.

Adaptation

The process by which an organism or species becomes better suited to its environment through changes in characteristics or behavior.

Simple Stimuli

Basic or straightforward sensory inputs that elicit or influence behavior without complex processing.

Attention

The process of selectively concentrating on one aspect of the environment while ignoring other things, crucial for cognitive processing.