SCENARIO 16-12 A local store developed a multiplicative time-series model to forecast its revenues in future quarters, using quarterly data on its revenues during the 5-year period from 2009 to 2013.The following is the resulting regression equation: where is the estimated number of contracts in a quarter. X is the coded quarterly value with X = 0 in the first quarter of 2008. is a dummy variable equal to 1 in the first quarter of a year and 0 otherwise. is a dummy variable equal to 1 in the second quarter of a year and 0 otherwise. is a dummy variable equal to 1 in the third quarter of a year and 0 otherwise.
-Referring to Scenario 16-12, the best interpretation of the coefficient of in the regression equation is:
A)the revenues in the second quarter of a year is approximately 5.4% lower than the average over all 4 quarters.
B)the revenues in the second quarter of a year is approximately 5.4% lower than it would be during the fourth quarter.
C)the revenues in the second quarter of a year is approximately 11.69% lower than the average over all 4 quarters.
D)the revenues in the second quarter of a year is approximately 11.69% lower than it would be during the fourth quarter.

Question

SCENARIO 16-12 A local store developed a multiplicative time-series model to forecast its revenues in future quarters, using quarterly data on its revenues during the 5-year period from 2009 to 2013.The following is the resulting regression equation:  where  is the estimated number of contracts in a quarter. X is the coded quarterly value with X = 0 in the first quarter of 2008.  is a dummy variable equal to 1 in the first quarter of a year and 0 otherwise.  is a dummy variable equal to 1 in the second quarter of a year and 0 otherwise.  is a dummy variable equal to 1 in the third quarter of a year and 0 otherwise.
-Referring to Scenario 16-12, the best interpretation of the coefficient of  in the regression equation is:
A)the revenues in the second quarter of a year is approximately 5.4% lower than the average over all 4 quarters. 
B)the revenues in the second quarter of a year is approximately 5.4% lower than it would be during the fourth quarter. 
C)the revenues in the second quarter of a year is approximately 11.69% lower than the average over all 4 quarters. 
D)the revenues in the second quarter of a year is approximately 11.69% lower than it would be during the fourth quarter.

Quizplus · Accepted Answer

The Answer of SCENARIO 16-12 A local store developed a multiplicative time-series model to forecast its revenues in future quarters, using quarterly data on its revenues during the 5-year period from 2009 to 2013.The following is the resulting regression equation:  where  is the estimated number of contracts in a quarter. X is the coded quarterly value with X = 0 in the first quarter of 2008.  is a dummy variable equal to 1 in the first quarter of a year and 0 otherwise.  is a dummy variable equal to 1 in the second quarter of a year and 0 otherwise.  is a dummy variable equal to 1 in the third quarter of a year and 0 otherwise.
-Referring to Scenario 16-12, the best interpretation of the coefficient of  in the regression equation is:
A)the revenues in the second quarter of a year is approximately 5.4% lower than the average over all 4 quarters. 
B)the revenues in the second quarter of a year is approximately 5.4% lower than it would be during the fourth quarter. 
C)the revenues in the second quarter of a year is approximately 11.69% lower than the average over all 4 quarters. 
D)the revenues in the second quarter of a year is approximately 11.69% lower than it would be during the fourth quarter.

SCENARIO 16-12 a Local Store Developed a Multiplicative Time-Series Model