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

question 169

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,the best interpretation of the constant 6.102 in the regression equation is

• A)the fitted value for the first quarter of 2005,after seasonal adjustment,is log₁₀(6.102).
• B)the fitted value for the first quarter of 2005,after seasonal adjustment,is 10^6.102.
• C)the fitted value for the first quarter of 2005,prior to seasonal adjustment,is log₁₀(6.102).
• D)the fitted value for the first quarter of 2005,prior to seasonal adjustment,is 10^6.102.

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Definitions:

Noncooperative Games

Games in game theory where players make decisions independently, without cooperation or communication with each other.

Constant Sum Game

A situation in game theory where the total benefit to all players in the game remains constant, regardless of the distribution of gains among players.

Negotiating

The process of discussing something with someone in order to reach an agreement.

Maximum Willingness-To-Pay

The highest amount an individual is willing to spend to acquire a good or service.