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Time Series and Forecasting Chapter 16
Goals ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Time Series ,[object Object],[object Object],[object Object],[object Object]
Components of a Time Series ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Cyclical Variation – Sample Chart
Seasonal Variation – Sample Chart
Secular Trend – Home Depot Example
Secular Trend – EMS Calls Example
Secular Trend – Manufactured Home Shipments in the U.S.
The Moving Average Method ,[object Object],[object Object],[object Object]
Moving Average Method - Example
Three-year and Five-Year Moving Averages
Weighted Moving Average ,[object Object],[object Object],[object Object],[object Object]
[object Object],Weighted Moving Average - Example
Weighted Moving Average - Example
Weighted Moving Average – An Example
Linear Trend ,[object Object]
Linear Trend Plot
Linear Trend – Using the Least Squares Method ,[object Object],[object Object],[object Object]
[object Object],Linear Trend – Using the Least Squares Method: An Example Year Sales ($ mil.) 2002 7 2003 10 2004 9 2005 11 2006 13 Year t Sales ($ mil.) 2002 1 7 2003 2 10 2004 3 9 2005 4 11 2006 5 13
Linear Trend – Using the Least Squares Method: An Example Using Excel
Nonlinear Trends ,[object Object],[object Object],[object Object]
Log Trend Equation – Gulf Shores Importers Example ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Log Trend Equation – Gulf Shores Importers Example
Log Trend Equation – Gulf Shores Importers Example
Seasonal Variation ,[object Object],[object Object],[object Object],[object Object]
Seasonal Index ,[object Object],[object Object],[object Object],[object Object]
[object Object],Seasonal Index – An Example
[object Object],[object Object],[object Object],[object Object],[object Object]
Seasonal Index – An Example
Actual versus Deseasonalized Sales for Toys International ,[object Object]
Actual versus Deseasonalized Sales for Toys International – Time Series Plot using Minitab
Seasonal Index – An Example Using Excel
Seasonal Index – An Example Using Excel
Seasonal Index – An Excel Example using Toys International Sales
Seasonal Index – An Example Using Excel ,[object Object],Quarter t Ŷ (unadjusted forecast) Seasonal Index Quarterly Forecast (seasonally adjusted forecast) Winter 25 10.35675 0.765 7.923 Spring 26 10.44666 0.575 6.007 Summer 27 10.53657 1.141 12.022 Fall 28 10.62648 1.519 16.142 Ŷ  = 8.109 + 0.0899(28) Ŷ X SI  = 10.62648 X 1.519
Durbin-Watson Statistic ,[object Object],[object Object],[object Object]
Durbin-Watson Test for Autocorrelation – Interpretation of the Statistic ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Durbin-Watson Critical Values (  =.05)
Durbin-Watson Test for Autocorrelation: An Example ,[object Object],Month Sales (000) Ad ($millions) 1 153 5.5 2 156 5.5 3 153 5.3 4 147 5.5 5 159 5.4 6 160 5.3 7 147 5.5 8 147 5.7 9 152 5.9 10 160 6.2 11 169 6.3 12 176 5.9 13 176 6.1 14 179 6.2 15 184 6.2 16 181 6.5 17 192 6.7 18 205 6.9 19 215 6.5 20 209 6.4
Durbin-Watson Test for Autocorrelation: An Example ,[object Object]
Durbin-Watson Test for Autocorrelation: An Example ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Durbin-Watson Test for Autocorrelation: An Example =E4^2 =(E4-F4)^2 =-43.802+35.95*C3 =B3-D3 =E3 ∑ (e i  -e i-1 ) 2 ∑ (e i ) 2
[object Object],[object Object],[object Object],[object Object],[object Object],Durbin-Watson Test for Autocorrelation: An Example d l =1.20 d u =1.41 Reject H 0 Positive Autocorrelation Inconclusive Fail to reject H 0 No Autocorrelation
[object Object]

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Chapter 16