Identify a time dependent variable in any kind of organization, business, or industry. Collect several
measurements of this variable over time. Draw a scatter diagram of this variable versus time. What are your observations?
- Is there a trend in the measurements? Explain.
- Are there any seasonal variation in the measurements? Explain.
- Add a trend line to the scatter diagram, and determine the trend equation. Interpret the trend equation.
Purpose: To demonstrate the application of time series analysis in your organization, business, or industry.
Example: John works for an electric utility company. Over the years the demand for electricity has been growing constantly. The electricity demand measured in Megawatts is an example of a time dependent variable. When a scatter diagram of electricity demand versus time is plotted, there is an upward trend and seasonal variation. The upward trend is the result of growing demand over time. The electricity demand is high during the summer season, and is low during winter season. This pattern is repeated year after year.