Suppose the following are the seasonal indices for the first three quarters of t

Question

Suppose the following are the seasonal indices for the first three quarters of the year for a quarterly series: Quarter Seasonal Index Q1 72.9 Q2 82.1 Q3 107.3 Remember that the seasonal indices should average 100 so you should be able to infer the seasonal index for Q4. Furthermore, suppose that the estimated coeffcients from a regression of the deseasonalized series on Time are given below: Coefficients Intercept 2, 403 Time 60.2 What is the forecast for period 53, if period 53 is a Q1? (please round your answer to 1 decimal place) __________

Explanation / Answer

Answer:

Forecast y = 2403+60.2*t

When t=53

y = 2403+60.2*53 =5593.6

seasonal index for Q1 is 72.9

forecast for the period 53 is =5593.6*0.729 =4077.7344

= 4077.7

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