TABLE 16-9
Given below are EXCEL outputs for various estimated autoregressive models for a company's real operating revenues (in billions of dollars)from 1989 to 2012.From the data,you also know that the real operating revenues for 2010,2011,and 2012 are 11.7909,11.7757 and 11.5537,respectively.
First-Order Autoregressive Model: Second-Order Autoregressive Model: Third-Order Autoregressive Model:
-Referring to Table 16-9,if one decides to use the Third-Order Autoregressive model,what will the predicted real operating revenue for the company be in 2014?
A)$11.55 billion
B)$11.62 billion
C)$12.47 billion
D)$12.57 billion

Question

TABLE 16-9
Given below are EXCEL outputs for various estimated autoregressive models for a company's real operating revenues (in billions of dollars)from 1989 to 2012.From the data,you also know that the real operating revenues for 2010,2011,and 2012 are 11.7909,11.7757 and 11.5537,respectively.
First-Order Autoregressive Model:  Second-Order Autoregressive Model:  Third-Order Autoregressive Model: 
-Referring to Table 16-9,if one decides to use the Third-Order Autoregressive model,what will the predicted real operating revenue for the company be in 2014?
A)$11.55 billion 
B)$11.62 billion 
C)$12.47 billion 
D)$12.57 billion

Quizplus · Accepted Answer

The Third-Order Autoregressive model uses the previous three periods' data to predict the next period's value. In this case, the previous three periods are 2011, 2012, and 2013. The predicted real operating revenue for 2014 is $12.57 billion.

TABLE 16-9 Given Below Are EXCEL Outputs for Various Estimated Autoregressive Models