Exam 18: Time Series and Forecasting

Prices of crude oil have been steadily rising over the last two years (The Wall Street Journal,December 14,2010).The monthly data on price per gallon of unleaded regular gasoline in the United States from January 2009 to December 2010 were available.Three trend models were created,and the following relevant information became available. Based on adjusted R²,which of the following models is the most appropriate for making a forecast for the price of regular unleaded gasoline?

In the decomposition method,which of the following time series is used to estimate the trend?

Given the estimated model = b₀ + b₁t,the one-step-ahead and multistep-ahead forecasts are possible,if we know,or can predict,future values of the ______________.

The following ratio-to-moving averages for the seasonally adjusted series were found by the decomposition method applied on a time series representing quarterly sales for the last three years: Which of the following is the seasonal index for the fourth quarter?

In a moving average method,when a new observation becomes available,the new average is computed by including the new observation and ________ .

Which of the following is an example of a time series?

Quantitative forecasting procedures are based on the judgment of the forecaster,who uses prior experience and expertise to make forecasts.

Which of the following is true of the exponential smoothing method?

The seasonal component typically represents repetitions over a ________ period.

When comparing polynomial trend models,we use adjusted R²,which imposes a penalty for ________________.

A time series with observed long-term upward movements in its values is said to have _________________.

Quarterly sales of a department store for the last seven years are given in the following table. The Excel scatterplot shown indicates that the quarterly sales have an increasing trend and seasonality.Therefore,the linear regression model,Sales = β₀ + β₁Qtr1 + β₂Qtr2 + β₃Qtr3 + β₄t + ε,with three seasonal dummy variables Qtr1,Qtr2,and Qtr3,and the decomposition method are proposed to make sales forecasts.For the regression model,the following Excel partial output is available. What is the regression equation for the linear trend model with seasonal dummy variables?

The following ratio-to-moving averages for the seasonally adjusted series were found by the decomposition method applied on a time series representing quarterly sales for the last three years: By what percent does the sales in Quarter 4 exceed the average quarterly sales?

To extract the trend from a time series,we first eliminate seasonal _________ by dividing the original series y,by its corresponding adjusted seasonal index.

In the quadratic trend model,y_t = β₀ + β₁t² + ε_t,which coefficient determines if the trend is going to be U-shaped or inverted U-shaped?

The past monthly demands are shown below.The naïve method,that is,the one-period moving average method,is applied to make forecasts. If the demand in May appears to be 35,what is the residual (error)for May?

Under which of the following conditions is qualitative forecasting considered attractive?

Which of the following is not true of a time series with a cyclical component?

A time series is ______.

The following table shows the annual revenues (in millions of dollars)of a pharmaceutical company over the period 1990-2011. The Excel scatterplot shown indicates that the annual revenues have an increasing trend.Therefore,linear,exponential,quadratic,and cubic models were used to fit the trend,and the following relevant information became available after applying linear regression. When all four trend regression equations are compared,which of them provides the best fit?