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# EconHM26 - Q uestion#1 T he number of cases of merlot wine...

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Question #1 The number of cases of merlot wine sold by a Paso Robles winery in an eight-year period follows. Year Cases of wine 1991 270 1992 356 1993 398 1994 456 1995 358 1996 500 1997 410 1998 376 Exponential smoothing with a weight or smoothing constant of 0.3 will be used to smooth the wine sales. The value of S 2 , the smoothed value for 1992 is 295.8 . Question #2 Example on page 111 (slide 18) of your course packet. Calculate the gasoline smoothed time series using exponential smoothing with weight or smoothing constant of 0.2. Data on gasoline prices is stored here . The value of S 5 , the smoothed value for period 5, is 40.4512 .

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Question #3 This question is based on the Pharmaceutical Sales example on page 112 (slide 24) of your course packet. Study the data set given here , which represents a time series of annual sales for a pharmaceutical company from 1990 to 1999. The forecasted trend component for this model for year 2001 is: 24.78545455 Question #5 This question is based on the Cigarette Consumption example on page 113 (slide 26) of your course packet. Study the data set given here , which represents a time series of per-capita cigarette consumption in the U.S. from 1955 to 1994. 1. From the scatter plot you can conclude that: o A non-linear trend model is called for. o A linear trend model is appropriate. o Cigarette consumption has been increasing uniformly.
o The series has a strong cyclical component. 2. In order to adopt the best model possible for your analysis, you know you will have to try a number of alternative models. Visual inspection has already indicated that a curve-linear model is likely to be appropriate, but you are not sure to what order (quadratic?, cubic?, to the fourth power?). Begin with the simplest model (linear),

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EconHM26 - Q uestion#1 T he number of cases of merlot wine...

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