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- 1. Consider the following time series: a. Construct a time series plot. What type of pattern exists in the data? b. Use simple linear regression analysis to find the parameters for the line that minimizes MSE for this time series.The demand for a product for the last six years has been 15, 15, 17, 18, 20, and 19. The manager wants to predict the demand for this time series using the following simple linear trend equation: trt = 12 + 2t. What are the forecast errors for the 5th and 6th years?IVP = initial value problem
- The weekly demand (in cases) for a particular brand of automatic dishwasher detergent for a chain of grocery stores located in Columbus, Ohio, follows. Week Demand 1 22 2 18 3 23 4 21 5 17 6 24 7 20 8 19 9 18 10 21 (a) Construct a time series plot. -A time series plot contains a series of 10 points connected by line segments. The horizontal axis is labeled Week and ranges from 0 to 10. The vertical axis is labeled Demand (in cases) and ranges from 0 to 30. The points are plotted at regular increments of 1 week starting at week 1 and ending at week 10 and appear to vary randomly between 15 and 25 on the vertical axis. -A time series plot contains a series of 10 points connected by line segments. The horizontal axis is labeled Week and ranges from 0 to 10. The vertical axis is labeled Demand (in cases) and ranges from 0 to 30. The points are plotted at regular increments of 1 week starting at week 1 and ending at week 10. They start on the left around…IVP: Initial-Value-Problemcanton Supplies, inc., is a service firm that employs approximately 100 individuals.Managers of canton Supplies are concerned about meeting monthly cash obligations andwant to develop a forecast of monthly cash requirements. Because of a recent changein operating policy, only the past seven months of data that follow are considered to berelevant.Month 1 2 3 4 5 6 7Cash Required ($1000s) 205 212 218 224 230 240 246a. construct a time series plot. What type of pattern exists in the data?b. Using Minitab or excel, develop a linear trend equation to forecast cash requirementsfor each of the next two months.
- Question 17 Suppose Carole has a total wealth of $100,000 and a utility described by U = E -A She has a risk aversion coefficient of A-1. She can borrow and lend/invest at the risk-free rate of 2.8%. Suppose the optimal risky portfolio has an expected return of 12% and a standard deviation of 27.5%, What is her optimal amount to borrow or lend/invest at the risk free rate? Indicate investing/lending as a positive number and borrowing as a negative number. Round to the nearest cent ($0.01). Your answer should not include the $ sign. If your answer is $25.34, it should be written as 25.34. Question 18 Ayear ago, an investor bought 200 shares of a "no-load" mutual fund at $10.01 per share. No-load funds do not change "entry fees or "exit" fees when buying or redeeming shares. Sometime during the year, the fund paid dividends of $0.71 per share and the fund paid capital gains of $0.14 per share - and these payments were reinvested in the fund at an average price of $10.73 per share…Two pumps capable of delivering 100 hp to an agricultural application are being evaluated in a present economy study. The selected pump will only be utilized for one year, and it will have no market value at the end of the year. Pertinent data are summarized as given follows. If electric power costs $0.10 per kWh and the pump will be operated 4,000 hours per year, which pump should be chosen? Recall that 1 hp = 0.746 kW.After its move in 1990 to La Junta, Colorado, and its new initiatives, the DeBourgh Manufacturing Company began an upward climb of record sales. Suppose the figures shown here are the DeBourgh monthly sales figures from January 2001 through December 2009 (in $1,000s). a) Produce a time series plot. Are there any trends evident in the data? Does DeBourgh have a seasonal component to its sales? b) Deseasonalize the data using Multiplicative model with a 0.5 weighted moving average. Produce a time series plot of the deseasonalized data and add a trendline. c) Forecast the sales from January to December of the year 2010. d) Include a discussion of the general direction of sales and any seasonal tendencies that might be occurrinG Month 2001 2002 2003 2004 2005 2006 2007 2008 2009 January 139.7 165.1 177.8 228.6 266.7 431.8 381 431.8 495.3 February 114.3 177.8 203.2 254 317.5 457.2 406.4 444.5 533.4 March 101.6 177.8 228.6 266.7 368.3 457.2 431.8 495.3 635 April 152.4 203.2…
- An interest rate of 15% is used to evaluate a new system that has a first cost of $212,400, annual operating and maintenance costs of $41,200, annual savings of $94,600, a life of 6 years, and a salvage value of $32,500. After initial evaluation, the firm receives word from the vendor that the first cost is 5% higher than originally quoted. The percentage error in the system's present worth from this is closest to what value?What is the definition of a covariance stationary process? Why is stationaritysuch as important issue in forecasting and time-series?A consumer interest group is tracking the percentage of household income spent on gasoline over the past 30 years. Which graphical display would be more useful, a histogram or a time-series graph. Why? a. A histogram because the change in data over time is the most relevant issue.b. A time-series graph because the change in data over time is the most relevant issue. c. A time-series graph because the range of values for the data is the most relevant issue.6. A histogram because the range of values for the data is the most relevant issue.