Instruction 14-5
a Local Store Developed a Multiplicative Time-Series Model $\hat { Y }$

question 145

Multiple Choice

Instruction 14-5
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:
log 10 $\hat { Y }$ = 6.102 + 0.012 X - 0.129 Q₁ - 0.054 Q₂ + 0.098 Q₃
Where
$\hat { Y }$ 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 Instruction 14-5,in testing the significance of the coefficient for Q₁ in the regression equation (-0.129) which has a p-value of 0.492.Which of the following is the best interpretation of this result?

• A)The revenues in the first quarter of the year are significantly different than the revenues in the fourth quarter (? = 0.05).
• B)The revenues in the first quarter of the year are not significantly different than the revenues in the fourth quarter (? = 0.05).
• C)The revenues in the first quarter of the year are significantly different than the revenues in an average quarter (? = 0.05).
• D)The revenues in the first quarter of the year are not significantly different than the revenues in an average quarter (? = 0.05).

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Definitions:

Place Theory

A theory in hearing that suggests the perception of pitch corresponds to the vibration of different places along the basilar membrane of the inner ear.

Basilar Membrane

A critical structure in the cochlea of the inner ear, it plays a key role in the mechanical analysis of sound waves for hearing.

Cochlea

A spiral-shaped cavity within the inner ear, playing a crucial role in converting sound waves into electrical signals.

Ossicles

Tiny ossicles located within the middle ear that transfer sound waves from the tympanic membrane to the cochlea.