Tom and Hank’s is a regional convenience store with locations in several small towns along the…

Tom and Hank’s is a regional convenience store with
locations in several small towns along the Mississippi River. The quarterly
revenue for the store beginning with the first quarter of 2005 and ending with
the second quarter of 2011 is shown below:

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a. Produce a time-series plot of the store’s revenues by
quarter. What time-series components appear to be present in the data?

b. Determine a seasonal index for each quarter.

c. Use the seasonal indexes from part b to deseasonalize the
data.

d. Graph and fit a linear trend line to the deseasonalized
data.

e. Use the linear trend line and the seasonal indexes to
produce a seasonally adjusted forecast for each quarter beginning with quarter
1 of 2005 and ending with quarter 2 of 2011.

f. Calculate a forecast error for each period.

g. Calculate the MAD and the MSE for the forecasts you
developed in part e.

h. Using the seasonal indexes and the estimated trend line,
produce a forecast for quarters 3 and 4 for 2011.

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