TABLE 16-12 A Local Store Developed a Multiplicative Time-Series Model to Forecast

Multiple Choice

TABLE 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 2008 to 2012.The following is the resulting regression equation:
log₁₀
= 6.102 + 0.012 X - 0.129 Q₁ - 0.054 Q₂ + 0.098 Q₃
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
Q₁ is a dummy variable equal to 1 in the first quarter of a year and 0 otherwise
Q₂ 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 Table 16-12,the best interpretation of the coefficient of Q₂ (-0.054) 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.