Q. Cypress River Landscape Supply is a large wholesale supplier of landscaping materials in Georgia. Cypress River's sales vary seasonally; sales tend to be higher in the spring months than in other months. a. Suppose Cypress River estimates a linear trend without accounting for this seasonal variation. What effect would this omission have on the estimated sales trend? b. Alternatively, suppose there is, in fact, no seasonal pattern to sales, and the trend line is estimated using dummy variables to account for seasonality. What effect would this have on estimation? Thank you for providing answer.
Q. Cypress River Landscape Supply is a large wholesale supplier of landscaping materials in Georgia. Cypress River's sales vary seasonally; sales tend to be higher in the spring months than in other months. a. Suppose Cypress River estimates a linear trend without accounting for this seasonal variation. What effect would this omission have on the estimated sales trend? b. Alternatively, suppose there is, in fact, no seasonal pattern to sales, and the trend line is estimated using dummy variables to account for seasonality. What effect would this have on estimation? Thank you for providing answer.
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Q. Cypress River Landscape Supply is a large wholesale supplier of landscaping materials in Georgia. Cypress River's sales vary seasonally; sales tend to be higher in the spring months than in other months.
a. Suppose Cypress River estimates a linear trend without accounting for this seasonal variation. What effect would this omission have on the estimated sales trend?
b. Alternatively, suppose there is, in fact, no seasonal pattern to sales, and the trend line is estimated using dummy variables to account for seasonality. What effect would this have on estimation?
a. Suppose Cypress River estimates a linear trend without accounting for this seasonal variation. What effect would this omission have on the estimated sales trend?
b. Alternatively, suppose there is, in fact, no seasonal pattern to sales, and the trend line is estimated using dummy variables to account for seasonality. What effect would this have on estimation?
Thank you for providing answer.
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