Question 8 37.5 pts Time Series Decomposition for TransSale Method Model type Mu

Question

Question 8 37.5 pts Time Series Decomposition for TransSale Method Model type Multiplicative Model Deta TransSales1000 Length 24 Time Series Decomposition for TransSales 1000 Method Model type Multiplicative Model Fitted Trend Equation -306.97+5.030t Seasonal Indices Period Index 1 0.59424 Accuracy Measures MAPE 3.911 MAD 13.336 MSD 348.716 Forecasts Period Forecast 25 257.135 2 109257 4 0.66659 3 164660 Time Series Decomposition Plot for TransSales Multiplicative Model Quarterly Data, Years 2010-2016 Using the results above, what do the seasonal indexes indicate? They indicate sales are 41% less than annual averages in period 1. o They indicate that in period 1. sales are lower by $594,000 compared to annual averages. O They indicate sales are $41.000 less than annual averages in period 1. They indicate sales are 59% less than annual averages in period 1

Explanation / Answer

Answer to the question)

The seasonal index is 0.59424

this tells us that the sales is 0.59424 times of the annual sales

Hence the decrease in sales is: 1 - 0.59424 = 0.40576 ~ 0.41

Thus there has been a decrease of 41% in the sales in period one as compared to the annual sales

Hence the correct answer choice is:

"They indicate sales are 41% less than the annual averages in period 1"

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