STATISTICS F/BUSINESS+ECONOMICS-TEXT
13th Edition
ISBN: 9781305881884
Author: Anderson
Publisher: CENGAGE L
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Textbook Question
Chapter 17.4, Problem 25E
Quarterly revenue ($ millions) for Twitter for the first quarter of 2012 through the first quarter of 2014 are shown below (adexchange.com, April, 2015):
| Quarter | Revenue ($ millions) |
| 1 | 54 |
| 2 | 68 |
| 3 | 82 |
| 4 | 112 |
| 5 | 114 |
| 6 | 139 |
| 7 | 169 |
| 8 | 243 |
| 9 | 250 |
- a. Construct a time series plot. What type of pattern exists in the data?
- b. Using Excel or Minitab, develop a linear trend equation for this time series.
- c. Using Excel or Minitab, develop a
quadratic trend equation for this time series. - d. Compare the MSE for each model. Which model appears better according to MSE?
- e. Use the models developed in parts (b) and (c) to forecast revenue for the tenth quarter.
- f. Which of the two forecasts in part (e) would you use? Explain.
Expert Solution & Answer
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Period
Observation
1
24
2
34
3
36
4
37
5
41
6
44
7
45
Plot the original time series and comment on appropriateness of a linear trend.
In retail, a store manager uses time series models to understand shopping trends.
Review the scatter plot of the store’s sales from 2010 through 2021 to answer the questions. See attached as image.
Here is the data for Fiscal Year and Sales:
Fiscal Year
Sales
2010
$260,123.00
2011
$256,853.00
2012
$274,366.00
2013
$290,525.00
2014
$322,318.00
2015
$380,921.00
2016
$541,925.00
2017
$909,050.00
2018
$1,817,521.00
2019
$3,206,564.00
2020
$4,921,005.00
2021
$5,686,338.00
Time series decomposition seeks to separate the time series (Y) into 4 components: trend (T), cycle (C), seasonal (S), and irregular (I). What is the difference between these components?
The model can be additive or multiplicative. When do you use each?
Review the scatter plot of the exponential trend of the time series data. Do you observe a trend? If so, what type of trend do you observe?
What predictions might you make about the store’s annual sales over the next few years?
A statistical program is recommended.
The quarterly sales data (number of copies sold) for a college textbook over the past three years follow.
Quarter
Year 1
Year 2
Year 3
1
1,690
1,800
1,860
2
950
910
1,110
3
2,625
2,910
2,940
4
2,510
2,370
2,615
(a)
Construct a time series plot.
What type of pattern exists in the data?
There appears be a downward linear trend but no seasonal pattern in the data.There appears to be a seasonal pattern in the data and perhaps a moderate upward linear trend. There appears be an upward linear trend but no seasonal pattern in the data.There appears to be a seasonal pattern in the data and perhaps a moderate downward linear trend.
(b)
Use a regression model with dummy variables as follows to develop an equation to account for seasonal effects in the data. (Round your numerical values to the nearest integer.)
Qrt1 = 1 if quarter 1, 0 otherwise; Qrt2 = 1 if quarter 2, 0 otherwise; Qrt3 = 1 if quarter 3, 0 otherwise
t =…
Chapter 17 Solutions
STATISTICS F/BUSINESS+ECONOMICS-TEXT
Ch. 17.2 - Consider the following time series data. Week 1 2...Ch. 17.2 - Refer to the time series data in exercise 1. Using...Ch. 17.2 - Exercises 1 and 2 used different forecasting...Ch. 17.2 - Consider the following time series data. Month 1 2...Ch. 17.3 - Consider the following time series data. Week 1 2...Ch. 17.3 - Consider the following time series data. Month 1 2...Ch. 17.3 - Refer to the gasoline sales time series data in...Ch. 17.3 - Refer again to the gasoline sales time series data...Ch. 17.3 - With the gasoline time series data from Table...Ch. 17.3 - With a smoothing constant of = .2, equation...
Ch. 17.3 - For the Hawkins Company, the monthly percentages...Ch. 17.3 - Corporate triple-A bond interest rates for 12...Ch. 17.3 - The values of Alabama building contracts (in ...Ch. 17.3 - The following time series shows the sales of a...Ch. 17.3 - Ten weeks of data on the Commodity Futures Index...Ch. 17.3 - The U.S. Census Bureau tracks the median price for...Ch. 17.4 - Consider the following time series data. a....Ch. 17.4 - Prob. 18ECh. 17.4 - Consider the following time series. a. Construct a...Ch. 17.4 - Prob. 20ECh. 17.4 - Prob. 21ECh. 17.4 - The Seneca Childrens Fund (SCF) is a local charity...Ch. 17.4 - The following table shows Googles annual revenue...Ch. 17.4 - FRED (Federal Reserve Economic Data), a database...Ch. 17.4 - Quarterly revenue ( millions) for Twitter for the...Ch. 17.4 - Giovanni Food Products produces and sells frozen...Ch. 17.4 - Prob. 27ECh. 17.5 - Consider the following time series. a. Construct a...Ch. 17.5 - Consider the following time series data. a....Ch. 17.5 - The quarterly sales data (number of copies sold)...Ch. 17.5 - Air pollution control specialists in southern...Ch. 17.5 - South Shore Construction builds permanent docks...Ch. 17.5 - Prob. 33ECh. 17.5 - Three years of monthly lawn-maintenance expenses...Ch. 17.6 - Consider the following time series data. a....Ch. 17.6 - Refer to exercise 35. a. Deseasonalize the time...Ch. 17.6 - The quarterly sales data (number of copies sold)...Ch. 17.6 - Three years of monthly lawn-maintenance expenses...Ch. 17.6 - Air pollution control specialists in southern...Ch. 17.6 - Electric power consumption is measured in...Ch. 17 - The weekly demand (in cases) for a particular...Ch. 17 - The following table reports the percentage of...Ch. 17 - United Dairies. Inc., supplies milk to several...Ch. 17 - The data contained in the DATAfile named CrudeCost...Ch. 17 - Annual retail store revenue for Apple from 2007 to...Ch. 17 - The Mayfair Department Store in Davenport, Iowa,...Ch. 17 - Prob. 47SECh. 17 - The Costello Music Company has been in business...Ch. 17 - Consider the Costello Music Company problem in...Ch. 17 - Refer to the Costello Music Company problem in...Ch. 17 - Refer to the Costello Music Company time series in...Ch. 17 - Hudson Marine has been an authorized dealer for CD...Ch. 17 - Refer to the Hudson Marine problem in exercise 52....Ch. 17 - Refer to the Hudson Marine problem in exercise 53....Ch. 17 - Refer to the Hudson Marine data in exercise 53. a....Ch. 17 - Forecasting Food and Beverage Sales The Vintage...Ch. 17 - Forecasting Lost Sales The Carlson Department...
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