value: 5.00 points Six years of quarterly data of a seasonally adjusted series a

Question

value: 5.00 points Six years of quarterly data of a seasonally adjusted series are used to estimate a linear trend model as T, 105.70+1.11t In addition, quarterly seasonal indices are calculated as 0.95, 32-094, 3.18 and 34 1.05 a-1. Interpret the first quarterly index. In other words, what is the value of the series in the first quarter as compared to the average? O 5% above O 95% below 95% above 5% below a-2. Interpret the fourth quarterly index. In other words, what is the value of the series in the fourth quarter as compared to the average? 5% below O 95% above 5% above O 95% below b. Make a forecast for all four quarters of next year. (Round your answers to 2 decimal places.) Quarter 1 Quarter 2 Quarter 3 Quarter 4

Explanation / Answer

a1)
0.95 is 0.05 below 1
hence
5% below
a2)
5 % above as 1.05 = 0.05+ 1

b)

t trend index forecast 25 133.45 0.95 126.7775 26 134.56 0.94 126.4864 27 135.67 1.18 160.0906 28 136.78 1.05 143.619

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