7 Averages 2

Question 1

Seasonal effect

Answer 1

The difference between the data point and the trend line on a time series graph
- seasonal effect = actual data point value - trend line value

Question 2

Mean seasonal variation

Answer 2

The means of seasonal effects taken at the same point in successive years
e.g. (seasonal effect or Quarter 1 of Year 1 = seasonal effect for Quarter 1 of Year 2) / 2
- can be used to predict values in the future

Question 3

Predicting future values on time series graphs

Answer 3

• extend the trend line beyond the data
• read the value of the trend line at the future point
• add on the mean seasonal variation