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Question
NARRBEGIN: SA_99_102The data shown below contains the monthly sales (in thousands of dollars) at a local department store for each of the past 24 months.
| Month | Sales | Month | Sales |
| 1 | 987 | 13 | 1080 |
| 2 | 1080 | 14 | 1002 |
| 3 | 975 | 15 | 968 |
| 4 | 1060 | 16 | 984 |
| 5 | 1030 | 17 | 1045 |
| 6 | 895 | 18 | 945 |
| 7 | 908 | 19 | 1025 |
| 8 | 1059 | 20 | 950 |
| 9 | 940 | 21 | 1004 |
| 10 | 1038 | 22 | 1075 |
| 11 | 1050 | 23 | 969 |
| 12 | 1030 | 24 | 1029 |
(A) Develop a time series plot of the data.
(B) Perform a runs test and compute a few autocorrelations to determine whether this time series is random.
(C) Given your answers to (A) and (B), what type of forecast do you recommend? Explain your answer.
(D) Use your answer to (C), to obtain a forecast for the next quarter (4 months). How reliable do you think this forecast is?
Answer
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