# You decide to estimate the following quarterly sales forecasting model for new boat sales in your local county

You decide to estimate the following quarterly sales forecasting model for new boat sales in your local county:
Qt = a + bt + cD
The equation is estimated using quarterly data on new boat sales in the county from the 3rd quarter of 2001 to the 4th quarter of 2007 (t = 1,…,26). The variable D is a dummy variable for the second quarter, which is the “season” for selling new boats: D = 1 in the second quarter, and 0 otherwise. The results of the estimation are:
DEPENDENT VARIABLE:
QT
R-SQUARE
F-RATIO
P-VALUE ON F
OBSERVATIONS:
26
0.5216
12.54
0.0002
PARAMETER
STANDARD
VARIABLE
ESTIMATE
ERROR
T-RATIO
P-VALUE
INTERCEPT
241.3
65.36
3.69
0.0012
T
47.52
13.55
3.51
0.0019
D
34.66
10.33
3.36
0.0027
a. Do the statistical estimates indicate a trend in sales? If so, what is the trend in units per quarter?
Week 4 Problems cont’d
b. Do the statistical estimates indicate a seasonal effect on 2nd quarter sales? If so, what is the seasonal effect in units per quarter?
c. What are the forecasted sales for the 1st quarter of 2008?
d. What are the forecasted sales for the 2nd quarter of 2008?
e. What are the forecasted sales for the 3rd quarter of 2008?
F. What are the forecasted sales for the 4rd quarter of 2008?