Multiple Choice
A time series regression equation for a surfboard manufacturing company in Australia is given below: Y = 35 + 4Q1 + 0.5Q3 + 8Q4 + 3t
With t in quarters and the origin is December 2010 and Q1 is the indicator variable for March, Q3 is the indicator variable for September and Q4 is the indicator variable for December.
Which of the following statements is correct regarding the coefficient of Q4?
A) This company expects to sell 8 more surfboards in the December quarter than in the March quarter or the September quarter.
B) This company expects to sell 8 more surfboards in the December quarter than in the June quarter.
C) This company expects to sell 8 more surfboards in the June quarter than in the December quarter.
D) None of these choices are correct.
Correct Answer:
Verified
Correct Answer:
Verified
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