1- An analyst for Davidson Computer Company estimated a quadratic trend model for forecasting the company’s revenue by using data from 2011 to 2022. Below is a partial reproduction of Excel Summary Output Regression Statistics Multiple R 0.899 R Square 0.867 Adjusted R Square 0.854 Standard Error 4.230613 Observations 12 Coefficients Standard Error t Stat P-value Intercept 29.5077 15.0238 1.9640 0.006781 X Variable 1 45.5250 17.1990 2.6469 1.04E-03 X Variable 2 -1.8069 0.6939 -2.6038 0.02306 Report the estimated equation and evaluate it. Forecast the company’s revenue for year 2023. 2- Many trucking companies are experiencing financial difficulties because of increasing costs of fuel and maintenance. The CEO of a company uses data from 2008 to 2022 and estimates the following first order autoregressive model: Ct = 4000 + 0.97 Ct-1 where Ct represent company’s fuel and maintenance costs in year t. Suppose that in 2020 the costs was $82000, predict the company fuel and maintenance costs for years 2021 and 2022. 3- (continuing from problem 5) Assume the CEO of the company also estimates the following linear trend model for fuel and maintenance costs from the same data Ct = 32000 + 3200 t What is the company’s fuel and maintenance costs for 2021 and 2022 based on this model? 4- (continuing from problems 5 and 6) If actual fuel and maintenance costs for 2021 and 2022 are 83500 and 85000 respectively, evaluate the forecasting power of each model based on MAPE.
1- An analyst for Davidson Computer Company estimated a quadratic trend model for forecasting the company’s revenue by using data from 2011 to 2022. Below is a partial reproduction of Excel Summary Output
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Regression Statistics |
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Multiple R |
0.899 |
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R Square |
0.867 |
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Adjusted R Square |
0.854 |
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Standard Error |
4.230613 |
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Observations |
12 |
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Coefficients |
Standard Error |
t Stat |
P-value |
|
Intercept |
29.5077 |
15.0238 |
1.9640 |
0.006781 |
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X Variable 1 |
45.5250 |
17.1990 |
2.6469 |
1.04E-03 |
|
X Variable 2 |
-1.8069 |
0.6939 |
-2.6038 |
0.02306 |
- Report the estimated equation and evaluate it.
- Forecast the company’s revenue for year 2023.
2- Many trucking companies are experiencing financial difficulties because of increasing costs of fuel and maintenance. The CEO of a company uses data from 2008 to 2022 and estimates the following first order autoregressive model:
Ct = 4000 + 0.97 Ct-1
where Ct represent company’s fuel and maintenance costs in year t. Suppose that in 2020 the costs was $82000, predict the company fuel and maintenance costs for years 2021 and 2022.
3- (continuing from problem 5) Assume the CEO of the company also estimates the following linear trend model for fuel and maintenance costs from the same data
Ct = 32000 + 3200 t
What is the company’s fuel and maintenance costs for 2021 and 2022 based on this model?
4- (continuing from problems 5 and 6) If actual fuel and maintenance costs for 2021 and 2022 are 83500 and 85000 respectively, evaluate the forecasting power of each model based on MAPE.
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