Question: Please solve and explain Consider the following time series data. Quarter Year 1 Year 2 Year 3 1 4 6 7 2 2 3 6

Please solve and explain

Consider the following time series data.

Quarter Year 1 Year 2 Year 3
1 4 6 7
2 2 3 6
3 3 5 6
4 5 7 8

a. Construct a time series plot. What type of pattern exists in the data?

b. Create the following dummy variables: Qtr1 = 1 if quarter 1, 0 otherwise; Qtr2 = 1 if quarter 2, 0 otherwise; Qtr3 = 1 if quarter 3, 0 otherwise. Create a variable t such that t = 1 for quarter 1 of year 1, t = 2 for quarter 2 of year 1, , t = 12 for quarter 4 of year 3. Use these dummy variables and t to develop an estimated regression equation to account for seasonal effects and any linear trend in the data. What is the forecast for quarter 1 of next year?

c. What is the forecast for quarter 2 of next year?

e. What is the forecast for quarter 4 of next year?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!