A firm uses trend projection and seasonal factors to simulat

A firm uses trend projection and seasonal factors to simulate sales for a given time period. It assigns \"0\" if sales fall, \"1\" if sales are steady, \"2\" if sales rise moderately, and \"3\" if sales rise a lot. The simulator generates the following output. 0 1 0 2 2 0 0 1 2 3 2 0 2 0 2 2 1 2 3 1 2 2 2 0 3 0 0 2 1 2 1; Estimate the probability that sales will rise moderately.

Solution

The data represents assigns \"0\" if sales fall, \"1\" if sales are steady, \"2\" if sales rise moderately, and \"3\" if sales rise a lot. Now we get the sample of . 31 observation as follows

0 1 0 2 2 0 0 1 2 3 2 0 2 0 2 2 1 2 3 1 2 2 2 0 3 0 0 2 1 2 1

now we want to Estimate the probability that sales will rise moderately.

that is

P( sales will rise moderately)=(number of cases in 31 sample sale rises)/31

=3/31=0.097