Chapter 17, Problem 55SE

Refer to the Hudson Marine data in exercise 53.

1. a. Deseasonalize the data and use the deseasonalized time series to identify the trend.
2. b. Use the results of part (a) to develop a quarterly forecast for next year based on trend.
3. c. Use the seasonal indexes developed in exercise 54 to adjust the forecasts developed in part (b) to account for the effect of season.

53. Refer to the Hudson Marine problem in exercise 52. Suppose the quarterly sales values for the seven years of historical data are as follows.

Year	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Total Yearly Sales
1	6	15	10	4	35
2	10	18	15	7	50
3	14	26	23	12	75
4	19	28	25	18	90
5	22	34	28	21	105
6	24	36	30	20	110
7	28	40	35	27	130

1. a. Use the following dummy variables to develop an estimated regression equation to account for any season and linear trend effects in the data: Qtr1 = 1 if Quarter 1, 0 otherwise; Qtr2 = 1 if Quarter 2, 0 otherwise; and Qtr3 = 1 if Quarter 3, 0 otherwise.
2. b. Compute the quarterly forecasts for next year.