TABLE 16-5 a Contractor Developed a Multiplicative Time-Series Model to Forecast the Forecast

Multiple Choice

TABLE 16-5
A contractor developed a multiplicative time-series model to forecast the number of contracts in future quarters, using quarterly data on number of contracts during the 3-year period from 1996 to 1998. The following is the resulting regression equation:
ln Y^{^} = 3.37 + 0.117 X - 0.083 Q₁ + 1.28 Q₂ + 0.617 Q₃
where
Y^{^} is the estimated number of contracts in a quarter
X is the coded quarterly value with X = 0 in the first quarter of 1996.
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.
Q₃ is a dummy variable equal to 1 in the third quarter of a year and 0 otherwise.
-Referring to Table 16-5, using the regression equation, which of the following values is the best forecast for the number of contracts in the third quarter of 1999?

A) 49091
B) 421697
C) 1482518
D) 133352