Retail Sales for a Home Improvement Store in Quarters 1-4

Essay

Retail sales for a home improvement store in quarters 1-4 over a five-year period are shown (in millions of dollars) in the table below. $$\begin{array} { c | c | c | c | c } \hline { \text { Quarter } } \\\hline \text { Year } & 1 & 2 & 3 & 4 \\\hline 1 & 1.2 & 1.4 & 1.5 & 1.1 \\\hline 2 & 1.3 & 1.6 & 1.5 & 1.2 \\\hline 3 & 1.4 & 1.8 & 1.8 & 1.6 \\\hline 4 & 1.4 & 1.7 & 1.9 & 1.6 \\\hline 5 & 1.6 & 2.0 & 2.1 & 1.9 \\\hline\end{array}$$ a. Write a regression model that contains trend and seasonal components to describe the sales data.
b. Use least squares regression to fit the model.
c. Use the regression model to forecast the quarterly sales during Year 6. Give 95% prediction intervals for the forecasts.