Question: Consider the following linear trend models estimated from 10 years of quarterly data with and without seasonal dummy variables d . d2, and d3. Here,

 Consider the following linear trend models estimated from 10 years of

Consider the following linear trend models estimated from 10 years of quarterly data with and without seasonal dummy variables d . d2, and d3. Here, d1=1 for quarter 1,0 otherwise; other dummy variables are defined similarly. Model 1: y=50.00+0.39t Model 2: 9=50.00+0.59t0.40d10.38d20.18d3 a. Use each model to make a forecast for y for the first and the fourth quarters of the 1tth year. Note: Round your answers to 2 decimal places. b. Which is the preferred model for forecasting if, relative to Model 1 , Model 2 has higher R2 but lower adjusted R2

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