Question 1

Quarterly seasonal factors will sum to 4.

Accepted Answer

A) True 
 B)False

Question 2

Which data would be measured over an interval of time as opposed to at a point in time?

Accepted Answer

A)  Toyota's total revenue for fiscal 2010
B)  Toyota's salaried employee head count at the end of June 2010
C)  Toyota's short-term indebtedness at the end of fiscal 2010
D)  Toyota's inventory of unsold vehicles on December 31, 2010E) B) and D)
F) C) and D)

Question 3

In exponential smoothing, using α = .20 will give a smoother series than using α = .05.

Accepted Answer

A) True 
 B)False

Question 4

Bob analyzed the trend in the value of his investment portfolio over the last 16 quarters. (1) Translate each trend into plain English that a business person could understand. (2) Use each fitted trend to make a mathematical prediction for Bob's investment portfolio's value in period 20. (3) Which trend model seems most reasonable (or more than one)? What would Occam's Razor say?

Accepted Answer

(1) Linear model: The fitted trend is y_t ...

Question 5

Mary collected data on women's summer Olympic 100 meter winning times and performed the trend analysis shown below. Describe the data and discuss her fitted trend's adequacy for making a 2008 forecast. What trend alternative(s), if any, might be preferred? Explain your reasoning.

Accepted Answer

The linear trend may give forecasts that are too low since times seem to have leveled out. The linear model predicts that times will continue to decline by .07 second every four years, but this did not happen in the last three Olympics. The fit is reasonably good, but historical fit is only one criterion. Linear trend (the simplest model) is a reasonable choice by Occam's Razor only if it gives adequate forecasts, which it doesn't in this case. As an alternative, Mary might try an exponential trend, which is also a simple two-parameter model.

Question 6

The quadratic model can never have more than one turning point (peaks or troughs).

Accepted Answer

A) True 
 B)False

Question 7

Monthly seasonal factors should be adjusted so they sum to 12.

Accepted Answer

A) True 
 B)False

Question 8

The fitted annual sales trend is yt = 227e.037t. The values of yt are:

Accepted Answer

A)  rising by an increasing amount each period.
B)  rising by a declining amount each period.
C)  declining by a declining amount each period.
D)  declining by an increasing amount each period.E) C) and D)
F) A) and B)

Question 9

Moving average models are causal models (as opposed to time-series models).

Accepted Answer

A) True 
 B)False

Question 10

Which trend would you choose to forecast the 2013 value of Bob's beer can collection?

Accepted Answer

A)  Exponential model.
B)  Quadratic model.
C)  They are equivalent.D) All of the above
E) A) and B)

Question 11

If the trend model yt = a + bt + ct² is fitted to a time series, we would get:

Accepted Answer

A)  R² that could be lower than the linear model.
B)  R² that could be either higher or lower than the linear model.
C)  R² that is at least as high as the linear model.
D)  no R² for this type of model because it is nonlinear.E) B) and C)
F) All of the above

Question 12

Which of the following is the least useful time-series forecasting model when there is a strong upward trend in the data?

Accepted Answer

A)  Estimated exponential trend model
B)  A five-period centered moving average
C)  Exponential smoothing with a high α
D)  Regression model with trend and seasonal binariesE) A) and D)
F) B) and C)

Question 13

Concerning a seasonal index for monthly data, which statement is incorrect?

Accepted Answer

A)  A multiplicative index value of 1.000 indicates no seasonal deviation from trend.
B)  Additive indexes are adjusted so they always sum to 12.
C)  To make forecasts, we multiply the trend by each month's seasonal index.
D)  Seasonal indexes are obtained by the process called decomposition of a time series.E) C) and D)
F) B) and C)

Question 14

The quadratic model's R2 is always at least as high as the linear model fitted to the same data.

Accepted Answer

A) True 
 B)False

Question 15

Consider the following linear trend equation of an industry's sales: yt = 120 + 12t, where t is measured in years and sales are measured in millions of dollars. Which is the most reasonable conclusion?

Accepted Answer

A)  We would forecast that sales will increase $12 million in the next year.
B)  We would forecast that sales will increase 12 percent in the next year.
C)  On the average, sales will increase 12/(120 + 12 × 10)  = 0.05, or 5 percent next year.
D)  The year-to-year change will depend on the value of t.E) None of the above
F) A) and B)

Question 16

If yt = 50e0.07t, then the forecast for period 10 is approximately:

Accepted Answer

A)  100.7.
B)  90.7.
C)  80.7.
D)  70.7.E) B) and D)
F) C) and D) A

Question 17

For the fitted time-series trend model yt = 9.23e-0.0867t, it is correct to say that:

Accepted Answer

A)  the series is growing by 9.23 percent.
B)  the series is growing by 8.67 percent.
C)  the model probably shows a low R2.
D)  the time series would be declining.E) A) and B)
F) B) and C)

Question 18

The shape of the fitted quadratic model yt = 544 + 62t - 3.2t2 is declining, then rising.

Accepted Answer

A) True 
 B)False

Question 19

To initialize the forecasts in an exponential smoothing process, it is acceptable to:

Accepted Answer

A)  use the average of the first six observed data values.
B)  use the most recent data value in the observed data.
C)  apply the smoothing constant α to the mean of the data.
D)  ask a panel of experts to make a guess at the initial forecast.E) A) and B)
F) C) and D)

Question 20

If a fitted trend equation is yt = 816e0.065t, then the forecast for period 7 is:

Accepted Answer

A)  1286.
B)  895.
C)  944.
D)  1018.E) B) and C)
F) All of the above A

Exam 14: Time Series Analysis

Quarterly seasonal factors will sum to 4.

Correct Answer
verified

Which data would be measured over an interval of time as opposed to at a point in time?

Correct Answer
verified

In exponential smoothing, using α = .20 will give a smoother series than using α = .05.

Correct Answer
verified

Correct Answer
verified
(1) Linear model: The fitted trend is y_t ...
View Answer

Mary collected data on women's summer Olympic 100 meter winning times and performed the trend analysis shown below. Describe the data and discuss her fitted trend's adequacy for making a 2008 forecast. What trend alternative(s), if any, might be preferred? Explain your reasoning.

The quadratic model can never have more than one turning point (peaks or troughs).

Correct Answer
verified

Monthly seasonal factors should be adjusted so they sum to 12.

Correct Answer
verified

The fitted annual sales trend is y_t = 227e^.037^t. The values of y_t are:

Correct Answer
verified

Moving average models are causal models (as opposed to time-series models).

Correct Answer
verified

Which trend would you choose to forecast the 2013 value of Bob's beer can collection?

Correct Answer
verified

If the trend model y_t = a + bt + ct² is fitted to a time series, we would get:

Correct Answer
verified

Which of the following is the least useful time-series forecasting model when there is a strong upward trend in the data?

Correct Answer
verified

Concerning a seasonal index for monthly data, which statement is incorrect?

Correct Answer
verified

The quadratic model's R² is always at least as high as the linear model fitted to the same data.

Correct Answer
verified

Consider the following linear trend equation of an industry's sales: y_t = 120 + 12t, where t is measured in years and sales are measured in millions of dollars. Which is the most reasonable conclusion?

Correct Answer
verified

If y_t = 50e^0.07^t, then the forecast for period 10 is approximately:

Correct Answer
verified
A

For the fitted time-series trend model y_t = 9.23e^-0.0867^t, it is correct to say that:

Correct Answer
verified

The shape of the fitted quadratic model y_t = 544 + 62t - 3.2t² is declining, then rising.

Correct Answer
verified

To initialize the forecasts in an exponential smoothing process, it is acceptable to:

Correct Answer
verified

If a fitted trend equation is y_t = 816e^0.065^t, then the forecast for period 7 is:

Correct Answer
verified
A

Exam 14: Time Series Analysis

Quarterly seasonal factors will sum to 4.

Correct AnswerverifiedShow Answer

Which data would be measured over an interval of time as opposed to at a point in time?

Correct AnswerverifiedShow Answer

In exponential smoothing, using α = .20 will give a smoother series than using α = .05.

Correct AnswerverifiedShow Answer

Correct Answerverified(1) Linear model: The fitted trend is yt ...View AnswerShow Answer

Mary collected data on women's summer Olympic 100 meter winning times and performed the trend analysis shown below. Describe the data and discuss her fitted trend's adequacy for making a 2008 forecast. What trend alternative(s), if any, might be preferred? Explain your reasoning.

The quadratic model can never have more than one turning point (peaks or troughs).

Correct AnswerverifiedShow Answer

Monthly seasonal factors should be adjusted so they sum to 12.

Correct AnswerverifiedShow Answer

The fitted annual sales trend is yt = 227e.037t. The values of yt are:

Correct AnswerverifiedShow Answer

Moving average models are causal models (as opposed to time-series models).

Correct AnswerverifiedShow Answer

Which trend would you choose to forecast the 2013 value of Bob's beer can collection?

Correct AnswerverifiedShow Answer

If the trend model yt = a + bt + ct² is fitted to a time series, we would get:

Correct AnswerverifiedShow Answer

Which of the following is the least useful time-series forecasting model when there is a strong upward trend in the data?

Correct AnswerverifiedShow Answer

Concerning a seasonal index for monthly data, which statement is incorrect?

Correct AnswerverifiedShow Answer

The quadratic model's R2 is always at least as high as the linear model fitted to the same data.

Correct AnswerverifiedShow Answer

Consider the following linear trend equation of an industry's sales: yt = 120 + 12t, where t is measured in years and sales are measured in millions of dollars. Which is the most reasonable conclusion?

Correct AnswerverifiedShow Answer

If yt = 50e0.07t, then the forecast for period 10 is approximately:

Correct AnswerverifiedA

For the fitted time-series trend model yt = 9.23e-0.0867t, it is correct to say that:

Correct AnswerverifiedShow Answer

The shape of the fitted quadratic model yt = 544 + 62t - 3.2t2 is declining, then rising.

Correct AnswerverifiedShow Answer

To initialize the forecasts in an exponential smoothing process, it is acceptable to:

Correct AnswerverifiedShow Answer

If a fitted trend equation is yt = 816e0.065t, then the forecast for period 7 is:

Correct AnswerverifiedA

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
(1) Linear model: The fitted trend is y_t ...
View Answer

Correct Answer
verified

Correct Answer
verified

The fitted annual sales trend is y_t = 227e^.037^t. The values of y_t are:

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

If the trend model y_t = a + bt + ct² is fitted to a time series, we would get:

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

The quadratic model's R² is always at least as high as the linear model fitted to the same data.

Correct Answer
verified

Consider the following linear trend equation of an industry's sales: y_t = 120 + 12t, where t is measured in years and sales are measured in millions of dollars. Which is the most reasonable conclusion?

Correct Answer
verified

If y_t = 50e^0.07^t, then the forecast for period 10 is approximately:

Correct Answer
verified
A

For the fitted time-series trend model y_t = 9.23e^-0.0867^t, it is correct to say that:

Correct Answer
verified

The shape of the fitted quadratic model y_t = 544 + 62t - 3.2t² is declining, then rising.

Correct Answer
verified

Correct Answer
verified

If a fitted trend equation is y_t = 816e^0.065^t, then the forecast for period 7 is:

Correct Answer
verified
A