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Six years of quarterly data of a seasonally adjusted series are used to estimate a linear trend model as t = 152.20 + 1.11t. In addition, quarterly seasonal indices are calculated as 1 = 0.97, 2 = 0.94, 3 = 1.17, and 4 = 1.09.

a-1. Interpret the first quarterly index. In other words, what is the value of the series in the first quarter as compared to the average? 

97% below

3% above

3% below

97% above

a-2. Interpret the fourth quarterly index. In other words, what is the value of the series in the fourth quarter as compared to the average?

9% below

91% below

9% above

91% above

b. Make a forecast for all four quarters of next year. (Round your answers to 2 decimal places.)

Quarter 1

Quarter 2

Quarter 3

Quarter 4

Statistics and Probability, Statistics

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