Suppose the following are the seasonal indices for the first

Suppose the following are the seasonal indices for the first three quarters of the year for a quarterly series: Quarter Seasonal Index

Q1 72.7

Q2 132.4

Q3 114

Remember that the seasonal indices should average 100 so you should be able to infer the seasonal index for Q4.

Furthermore, suppose that the estimated coeffcients from a regression of the deseasonalized series on Time are given below:

Coefficients Intercept 2,639

Time 70.6

In general, what quarter is the busiest time of the year? (please just answer 1, 2, 3, or 4)

Solution

In general, what quarter is the busiest time of the year?

2