How the classical decomposition method could be modified

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Reference no: EM13930329

A company's six-monthly sales figures for a five-year period are given below (in millions of dollars).

	1992	1993	1994	1995	1996
Jan-June	1.09	1.10	1.08	1.04	1.03
July-Dec	1.07	1.06	1.03	1.01	0.96

(a) Obtain a trend estimate using a centered 2 MA smoother and compute the de-trended figures assuming an additive decomposition.

(b) Assuming the seasonality is not changing over time, calculate seasonally adjusted figures for 1996.

(c) Suppose several more years of data were available. Explain in about two sentences how the classical decomposition method could be modified to allow for seasonal effects changing over time.

Reference no: EM13930329

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