Bob Kehoe runs a small business clearing snow in the winter and cutting grass in the other

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Bob Kehoe runs a small business clearing snow in the winter and cutting grass in the other seasons. For the last three years he has kept his prices constant but has experienced an upward trend in his income as new households move into his growing community and seek his services. However, Bob€™s income is subject to seasonal fluctuations. Dividing the year into four seasons, the following data show Bob€™s seasonal income in thousands of dollars for the past three years. 

Bob's Income (in thousands of dollars) Year Jan-Mar Jul-Sep Apr-Jun Oct-Dec Total 22 25 20 13 24 24 16 85 21 22 3 30 91

Bob is still happy to take on more work. Assuming his prices remain unchanged and his community continues to grow, use Excel€™s Regression tool to forecast Bob€™s income in the four seasons of the next year and his total income for the year. Use seasonal dummy variables in your analysis. 

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Related Book For  book-img-for-question

Managerial Economics and Strategy

ISBN: 978-0134167879

2nd edition

Authors: Jeffrey M. Perloff, James A. Brander

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