Question: The High-Volt Electric Company has a difficult time predicting the quarterly sales for its room air conditioner line due to the substantial seasonality in product

The High-Volt Electric Company has a difficult time predicting the quarterly sales for its room air conditioner line due to the substantial seasonality in product sales.
Quarterly sales data for the last three years are shown as follows:

a. Determine the best straight-line trend using simple regression analysis.
b. Determine the seasonal indices for each quarter using the trend line values in your seasonal index computations.
c. By means of classic time series decomposition, forecast the sales for the next four quarters.

LAST YEAR TWO YEARS AGO THREE YEARS AGO Quarter Units Quarter Units Quarter Units 27,000 70,000 41,000 13,000 34,000 82,000 51,000 16,000 30,000 73,000 48,000 15,000

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a The data may be restated as shown below Trend value a Seasonal Sales S t S t t 2 S t index b 27000 ... View full answer

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