Quarterly Sales of a Department Store for the Last Seven

question 73

Short Answer

Quarterly sales of a department store for the last seven years are given in the following table. The scatterplot shows that the quarterly sales have an increasing trend and seasonality. A linear regression model given by Sales = β₀ + β₁Qtr1 + β₂Qtr2 + β₃Qtr3 + β₄t + ε, where t is the time period (t = 1, ..., 28) and Qtr1, Qtr2, and Qtr3 are quarter dummies, is estimated and then used to make forecasts. For the regression model, the following partial output is available. Using the regression equation for the linear trend model with seasonal dummy variables, what is the sales forecast for the fourth quarter of Year 8?

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Definitions:

Three-Dimensional

Pertaining to having or appearing to have length, breadth, and depth, often used to describe objects or concepts that have a tangible or realistic quality.

Idea Box

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Delaying or deferring an activity or decision to a later time.