Using the following time series data of U.S. new car sales ($ millions), respond to the following items. (The data are sourced from https://www.census.gov/retail/index.html#mrts. Find “Monthly Retail Trade Report,” then select “Time Series/Trend Charts” to find the data for U.S. new car sales.)

a. Graph the data.

b. Based on the graph, describe the time series pattern.

c. For this time series, why is forecasting with a trend model appropriate?

d. Evaluate a trend forecasting model using simple linear regression. What are the MAD and MAPE?

e. What is the predicted annual change in industry sales?

f. Predict sales for the next 3 years.

g. In your judgment, are the forecasts “good”? What disclaimer would you include with your forecast?

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$ Sales (Millions) Year 2012 $672,550 2013 735,374 2014 785,142 2015 842,120 2016 877,743 $ Sales (Millions) Year 2017 $ 911,157 2018 943,538 2019 2020 2021 944,324 931,212 1,131,310