OC Music Company has been in business for 4 years. Data about the sales of each quarter were collected below. The manager wants use these data to forecast sales of the 5th year. Year Quarter Sales 1 Q1 7 1 02 2 1 Q3 4 1 Q4 12 2 Q1 6 2 Q2 3 2 Q3 8 2 Q4 14 3 01 10 3 Q2 3 3 03 5 3 Q4 16 4 Q1 12 4 Q2 4 4 03 7 4 Q4 20 (a) Develop a regression model for trend and seasonality. How many independent variables do you have in your regression? (b) How much of the variations in sample value of dependent variable does the developed regression model for trend and seasonality explain? Do not use percentage. Rounded to two decimal places. For example, if the value from the excel output is 0.7896, you should type 0.79 in the box. (c) Use the developed regression model for trend and seasonality to forecast for sales of the first quarter in the 5th year. Round your answer to two decimal places. (D) What is the MSE for this time series forecast when using the developed model for trend and seasonality? Round your answer to two decimal places
OC Music Company has been in business for 4 years. Data about the sales of each quarter were collected below. The manager wants use these data to forecast sales of the 5th year. Year Quarter Sales 1 Q1 7 1 02 2 1 Q3 4 1 Q4 12 2 Q1 6 2 Q2 3 2 Q3 8 2 Q4 14 3 01 10 3 Q2 3 3 03 5 3 Q4 16 4 Q1 12 4 Q2 4 4 03 7 4 Q4 20 (a) Develop a regression model for trend and seasonality. How many independent variables do you have in your regression? (b) How much of the variations in sample value of dependent variable does the developed regression model for trend and seasonality explain? Do not use percentage. Rounded to two decimal places. For example, if the value from the excel output is 0.7896, you should type 0.79 in the box. (c) Use the developed regression model for trend and seasonality to forecast for sales of the first quarter in the 5th year. Round your answer to two decimal places. (D) What is the MSE for this time series forecast when using the developed model for trend and seasonality? Round your answer to two decimal places
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:OC Music Company has been in business for 4 years. Data about
the sales of each quarter were collected below. The manager
wants use these data to forecast sales of the 5th year.
Year
Quarter
Sales
1
Q1
7
1
02
2
1
Q3
4
1
Q4
12
2
Q1
6
2
Q2
3
2
Q3
8
2
Q4
14
3
01
10
3
Q2
3
3
03
5
3
Q4
16
4
Q1
12
4
Q2
4
4
03
7
4
Q4
20
(a) Develop a regression model for trend and seasonality. How
many independent variables do you have in your regression?
(b) How much of the variations in sample value of dependent
variable does the developed regression model for trend and
seasonality explain? Do not use percentage. Rounded to two
decimal places. For example, if the value from the excel output is
0.7896, you should type 0.79 in the box.
(c) Use the developed regression model for trend and seasonality
to forecast for sales of the first quarter in the 5th year. Round
your answer to two decimal places.
(D) What is the MSE for this time series forecast when using the
developed model for trend and seasonality? Round your answer
to two decimal places
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