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Question:
Part (a):
The quarterly earnings (in millions of dollars) of a large textile manufacturing company have been recorded for the years 2010-2013. These data are shown in the following table.
Quarter 2010 2011 2012 20131 52 57 60 662 67 75 77 823 85 90 94 984 54 61 63 67
Using a four-quarter centred moving average, measure the quarterly variation by calculating the seasonal (quarterly) indexes. Use these to obtain the seasonally adjusted earnings for each of the 16 quarters.
Part (b):
The following trend line and seasonal indexes were calculated from six years of quarterly observations:
Trend line: y^(t) = 2000 + 80t - 2(02) Seasonal indexes:
Quarter Seasonal Index1 0.62 0.93 1.14 1.4
Forecast the four quarterly values for next year.
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