Consider the following time series data.
| Quarter | Year 1 | Year 2 | Year 3 |
| 1 | 2 | 5 | 7 |
| 2 | 0 | 2 | 6 |
| 3 | 5 | 8 | 10 |
| 4 | 5 | 8 | 10 |
| b) | Use a multiple regression model with dummy variables as follows to develop an equation to account for seasonal effects in the data. Qtr1 = 1 if Quarter 1, 0 otherwise; Qtr2 = 1 if Quarter 2, 0 otherwise; Qtr3 = 1 if Quarter 3, 0 otherwise. | ||||||||||||||||||||
| If required, round your answers to three decimal places. For subtractive or negative numbers use a minus sign even if there is a + sign before the blank. (Example: -300) If the constant is "1" it must be entered in the box. Do not round intermediate calculation. | |||||||||||||||||||||
| ŷ = + Qtr1 + Qtr2 + Qtr3 | |||||||||||||||||||||
| (c) | Compute the quarterly forecasts for next year based on the model you developed in part (b). | ||||||||||||||||||||
| If required, round your answers to three decimal places. Do not round intermediate calculation. | |||||||||||||||||||||
|
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| (d) | Use a multiple regression model to develop an equation to account for trend and seasonal effects in the data. Use the dummy variables you developed in part (b) to capture seasonal effects and create a variable tsuch that t = 1 for Quarter 1 in Year 1, t = 2 for Quarter 2 in Year 1,… t = 12 for Quarter 4 in Year 3. | ||||||||||||||||||||
| If required, round your answers to three decimal places. For subtractive or negative numbers use a minus sign even if there is a + sign before the blank. (Example: -300) | |||||||||||||||||||||
| ŷ = + Qtr1 + Qtr2 + Qtr3 + t | |||||||||||||||||||||
| (e) | Compute the quarterly forecasts for next year based on the model you developed in part (d). | ||||||||||||||||||||
| Do not round your interim computations and round your final answer to three decimal places. | |||||||||||||||||||||
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| (f) | Is the model you developed in part (b) or the model you developed in part (d) more effective? | ||||||||||||||||||||
| If required, round your intermediate calculations and final answer to three decimal places. | |||||||||||||||||||||
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| - Select your answer -Model developed in part (b)Model developed in part (d)Item 22 | |||||||||||||||||||||
| Justify your answer. | |||||||||||||||||||||
| The input in the box below will not be graded, but may be reviewed and considered by your instructor. |
Please show steps to solve using Excel.
In: Statistics and Probability
Investiment opportuity as folows: Year 0, unknown cash flow, Year 1 = 200 cash flos,,Year 2 = 400 cash flow, Year 3 = -100 cash flow, year 4= 500 cash flow, Year 5 = 200 cash flow
a. If other investments with comparble risk are earning 12% then how mudh shoud you be willing to pay for this investment?
If you purchace it for 800 then what is the anual rate of retun on the investment?
In: Finance
Consider the following time series.
| Quarter | Year 1 | Year 2 | Year 3 |
|---|---|---|---|
| 1 | 70 | 67 | 61 |
| 2 | 48 | 40 | 50 |
| 3 | 58 | 60 | 53 |
| 4 | 79 | 82 | 73 |
(b)Use the following dummy variables to develop an estimated regression equation to account for seasonal effects in the data:
x1 = 1 if quarter 1, 0 otherwise; x2 = 1 if quarter 2, 0 otherwise; x3 = 1 if quarter 3, 0 otherwise.
=
(c)Compute the quarterly forecasts for next year.
quarter 1 forecast___
quarter 2 forecast___
quarter 3 forecast___
quarter 4 forecast___
In: Statistics and Probability
Consider the following time series data.
| Quarter | Year 1 | Year 2 | Year 3 |
| 1 | 5 | 8 | 10 |
| 2 | 2 | 4 | 8 |
| 3 | 1 | 4 | 6 |
| 4 | 3 | 6 | 8 |
A.) Use a multiple regression model with dummy variables as
follows to develop an equation to account for seasonal effects in
the data. Qtr1 = 1 if Quarter 1, 0 otherwise; Qtr2 = 1 if Quarter
2, 0 otherwise; Qtr3 = 1 if Quarter 3, 0 otherwise. If required,
round your answers to three decimal places. For subtractive or
negative numbers use a minus sign even if there is a + sign before
the blank. (Example: -300) If the constant is "1" it must be
entered in the box. Do not round intermediate calculation.
|
| B.)Use a multiple regression model to develop an equation to account for trend and seasonal effects in the data. Use the dummy variables you developed in part (a) to capture seasonal effects and create a variable t such that t = 1 for Quarter 1 in Year 1, t = 2 for Quarter 2 in Year 1,… t = 12 for Quarter 4 in Year 3. | |
If required, round your answers to three decimal places. For
subtractive or negative numbers use a minus sign even if there is a
+ sign before the blank. (Example: -300)
|
C.) Is the model you developed in part (a) or the model you
developed in part (b) more effective? If required, round your
intermediate calculations and final answer to three decimal places.
|
D.) Justify your answer
In: Statistics and Probability
Consider the following time series:
| Quarter | Year 1 | Year 2 | Year 3 |
| 1 | 66 | 63 | 57 |
| 2 | 48 | 40 | 50 |
| 3 | 59 | 61 | 54 |
| 4 | 73 | 76 | 67 |
Use a multiple linear regression model with dummy variables as follows to develop an equation to account for seasonal effects in the data: Qtr1 = 1 if quarter 1, 0 otherwise; Qtr2 = 1 if quarter 2, 0 otherwise; Qtr3 = 1 if quarter 3, 0 otherwise. For subtractive or negative numbers use a minus sign even if there is a + sign before the blank. (Example: -300)
| Compute the quarterly forecasts for next year. | ||||||||||||||||
|
In: Statistics and Probability
Consider the following time series data.
| Quarter | Year 1 | Year 2 | Year 3 |
| 1 | 4 | 6 | 7 |
| 2 | 0 | 1 | 4 |
| 3 | 3 | 5 | 6 |
| 4 | 5 | 7 | 8 |
| (b) | Use a multiple regression model with dummy variables as follows to develop an equation to account for seasonal effects in the data. Qtr1 = 1 if Quarter 1, 0 otherwise; Qtr2 = 1 if Quarter 2, 0 otherwise; Qtr3 = 1 if Quarter 3, 0 otherwise. | |||||||||||||||
| If required, round your answers to three decimal places. For subtractive or negative numbers use a minus sign even if there is a + sign before the blank. (Example: -300) If the constant is "1" it must be entered in the box. Do not round intermediate calculation. | ||||||||||||||||
| ŷ = + Qtr1 + Qtr2 + Qtr3 | ||||||||||||||||
| (c) | Compute the quarterly forecasts for next year based on the model you developed in part (b). | |||||||||||||||
| If required, round your answers to three decimal places. Do not round intermediate calculation. | ||||||||||||||||
|
||||||||||||||||
| (d) | Use a multiple regression model to develop an equation to account for trend and seasonal effects in the data. Use the dummy variables you developed in part (b) to capture seasonal effects and create a variable t such that t = 1 for Quarter 1 in Year 1, t = 2 for Quarter 2 in Year 1,… t = 12 for Quarter 4 in Year 3. | |||||||||||||||
| If required, round your answers to three decimal places. For subtractive or negative numbers use a minus sign even if there is a + sign before the blank. (Example: -300) | ||||||||||||||||
| ŷ = + Qtr1 + Qtr2 + Qtr3 + t |
In: Statistics and Probability
Trend Analysis
Critelli Company has provided the following comparative information:
| Year 5 | Year 4 | Year 3 | Year 2 | Year 1 | ||||||
| Net income | $1,283,300 | $1,106,300 | $929,700 | $794,600 | $673,400 | |||||
| Interest expense | 436,300 | 398,300 | 344,000 | 262,200 | 208,800 | |||||
| Income tax expense | 410,656 | 309,764 | 260,316 | 206,596 | 161,616 | |||||
| Average total assets | 7,676,786 | 6,777,477 | 5,789,545 | 4,915,349 | 4,181,043 | |||||
| Average stockholders' equity | 2,629,713 | 2,353,830 | 2,056,858 | 1,822,477 | 1,595,735 | |||||
You have been asked to evaluate the historical performance of the company over the last five years.
Selected industry ratios have remained relatively steady at the following levels for the last five years:
| Industry Ratios | ||
| Return on total assets | 22.1 % | |
| Return on stockholders’ equity | 45.6 % | |
| Times interest earned | 4.6 | |
Instructions:
Calculate three ratios for Year 1 through Year 5. Round to one decimal place.
a. Return on total assets:
| Year 5 | % |
| Year 4 | % |
| Year 3 | % |
| Year 2 | % |
| Year 1 | % |
b. Return on stockholders’ equity:
| Year 5 | % |
| Year 4 | % |
| Year 3 | % |
| Year 2 | % |
| Year 1 | % |
c. Times interest earned:
| Year 5 | |
| Year 4 | |
| Year 3 | |
| Year 2 | |
| Year 1 |
In: Accounting
Consider the following time series data.
| Quarter | Year 1 | Year 2 | Year 3 |
| 1 | 3 | 6 | 7 |
| 2 | 4 | 1 | 8 |
| 3 | 1 | 7 | 5 |
| 4 | 5 | 7 | 8 |
a. Which of the following is a time series plot?
- Select your answer -time series plot #1time series plot #2time series plot #3Item 1
What type of pattern exists in the data?
- Select your answer -upward linear trendnonlinear trend and a seasonal patternlinear trend and a seasonal patternslight curvaturedownward linear trendItem 2
b. Show the four-quarter and centered moving average values for this time series (to 3 decimals if necessary).
| Year | Quarter | Time Series Value | Four-Quarter Moving Average | Centered Moving Average |
| 1 | 1 | 3 | ||
| 2 | 4 | |||
| _________ | ||||
| 3 | 1 | _____ | ||
| __________ | ||||
| 4 | 5 | _________ | ||
| __________ | ||||
| 2 | 1 | 6 | ______ | |
| ________ | ||||
| 2 | 1 | _______ | ||
| ______ | ||||
| 3 | 7 | _______ | ||
| ________ | ||||
| 4 | 7 | ________ | ||
| ________ | ||||
| 3 | 1 | 7 | __________ | |
| ________ | ||||
| 2 | 8 | ________ | ||
| ________ | ||||
| 3 | 5 | |||
| 4 | 8 |
c. Compute seasonal indexes and adjusted seasonal indexes for the four quarters (to 3 decimals).
| Quarter | Seasonal Index |
Adjusted Seasonal Index |
| 1 | ||
| 2 | ||
| 3 | ||
| 4 | ||
| Total |
In: Statistics and Probability
Trend Analysis
Critelli Company has provided the following comparative information:
| Year 5 | Year 4 | Year 3 | Year 2 | Year 1 | ||||||
| Net income | $1,052,000 | $906,900 | $762,100 | $651,400 | $552,000 | |||||
| Interest expense | 357,700 | 326,500 | 282,000 | 215,000 | 171,100 | |||||
| Income tax expense | 336,640 | 253,932 | 213,388 | 169,364 | 132,480 | |||||
| Average total assets | 6,350,000 | 5,606,364 | 4,789,450 | 4,067,606 | 3,459,809 | |||||
| Average stockholders' equity | 2,169,072 | 1,941,970 | 1,697,327 | 1,504,388 | 1,317,422 | |||||
You have been asked to evaluate the historical performance of the company over the last five years.
Selected industry ratios have remained relatively steady at the following levels for the last five years:
| Industry Ratios | ||
| Return on total assets | 21.9 % | |
| Return on stockholders’ equity | 45.3 % | |
| Times interest earned | 4.6 | |
Instructions:
Calculate three ratios for Year 1 through Year 5. Round to one decimal place.
a. Return on total assets:
| Year 5 | % |
| Year 4 | % |
| Year 3 | % |
| Year 2 | % |
| Year 1 | % |
b. Return on stockholders’ equity:
| Year 5 | % |
| Year 4 | % |
| Year 3 | % |
| Year 2 | % |
| Year 1 | % |
c. Times interest earned:
| Year 5 | |
| Year 4 | |
| Year 3 | |
| Year 2 | |
| Year 1 |
In: Accounting
Consider the following international investment opportunity:
year 0 -50000 euro Year 1 15000 euro year 2 15000 year 3 15000
The current exchange rate is $1.60 = €1.00. The inflation rate in the U.S. is 3 percent and in the euro-zone 2 percent. The appropriate cost of capital to a U.S.-based firm for a domestic project of this risk is 8 percent.
Find the dollar cash flows to compute the dollar-denominated NPV of this project.
In: Finance