A Time Series Regression Equation for a Surfboard Manufacturing Company

question 72

Multiple Choice

A time series regression equation for a surfboard manufacturing company in Australia is given below: Y = 35 + 4Q₁ + 0.5Q₃ + 8Q₄ + 3t
With t in quarters and the origin is December 2010 and Q₁ is the indicator variable for March, Q₃ is the indicator variable for September and Q₄ is the indicator variable for December.
Which of the following statements is correct regarding the coefficient of Q₄?

• A)This company expects to sell 8 more surfboards in the December quarter than in the March quarter or the September quarter.
• B)This company expects to sell 8 more surfboards in the December quarter than in the June quarter.
• C)This company expects to sell 8 more surfboards in the June quarter than in the December quarter.
• D)None of these choices are correct.

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Definitions:

Statistical Procedure

A method or set of methods used in analyzing data to achieve a specific outcome or make certain inferences.

Simple Comparisons

Comparisons conducted between individual levels of variables, focused on examining specific differences rather than overarching trends or patterns.

Analytical Comparisons

Comparisons made using analytical methods to examine differences or relationships among variables in a dataset.

Only Two Groups

A condition where only two distinct categories or groups are considered for comparison or analysis.