Table 14.4.3 shows the quarterly net sales of Mattel, a major designer, manufacturer, and marketer of toys.

Question:

Table 14.4.3 shows the quarterly net sales of Mattel, a major designer, manufacturer, and marketer of toys. Because of seasonal gift giving, you might expect fourth-quarter sales to be much higher, generally, than those of the other three quarters of the year. 

a. Construct a time-series plot for this data set. Describe any trend and seasonal behavior that you see in the plot. 

b. Calculate the moving average (using 1 year of data at a time) for this time series. Construct a time-series plot with both the data and the moving average. 

c. Find the seasonal index for each quarter. Do these values appear reasonable when you look at the time-series plot of the data? 

d. Which is Mattel’s best quarter (1, 2, 3, or 4)? On average, how much higher are sales as compared to a typical quarter during the year? 

e. Find the seasonally adjusted sales corresponding to each of the original sales values. 

f. From the second to the third quarter of 2014, sales went up from 1.062 to 2.021 billion. What happened on a seasonally adjusted basis? 

g. From the first to the second quarter of 2014, Mattel’s sales rose by over $100 million, from 0.946 to 1.062 billion. What happened on a seasonally adjusted basis? 

h. Find the regression equation to predict the long-term trend in seasonally adjusted sales for each time period, using 1, 2,… for the X variable. 

i. Compute the seasonally adjusted forecast for the second quarter of 2015. 

j. Compute the forecast for the second quarter of 2015. 

k. Compare the forecast from part j to Mattel’s actual net sales of 0.988 billion for the second quarter of 2015. Is your result consistent with the possibility that the strengthening dollar during this time period reduced the value of foreign sales? 

TABLE 14.4.3 Quarterly Net Sales for Mattel Net Sales Net Sales ($ Billions) ($ Billions) Year Year 2012 0.928 2013 2.20

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