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AutoSave OFF BESU- Housing Units Home Insert Draw Page Layout Formulas Data Review View Shape Format Tell me Share Comments Clear +3 Show Detail 18. Connections B: Properties Edit Links 2 Z Reapply Stocks Geogra. Sort Filter From From New Database HTML Text Query Refresh All Consolidate Text to Columns Advanced Flash Fill Remove Data Duplicates Validation What If Analysis Group Ungroup Subtotale Hide Detail Analysis Data Tools Analysis Check for Updates > Office Update To keep up-to-date with security updates, fixes, and improvements, choose Check for Updates. TextBox 3 x fx A B D E F G . 1 J L M N 0 P P 0 R S U V w Y New Privately owned Housing Units Started in the US (US Housing Starts) from January 1990 to February 2021 are listed in the spreadsheet to the left. This data is considered one of the economic indicators of future economic activity. You have been asked to generate a forecast for US Housing Starts for March 2021 but you are also asked to consider several forecasting methods. a. Insert a Line Chart of the time series of US Housing Starts with Month Year on the x-axis. Properly label and title your chart. Carefully describe the time series using a text box. b. Insert a series of new columns between Month Year and US Housing Starts. Create dummy variables for the months and for a trend. Estimate a regression using the regression tool in the Data Analysis tab with US Housing Starts as a function of the monthly dummy variables and trend variable. Using a Line Chart, plot the original time series and the Predicted US Housing Starts. Type your estimated regression equation using a text box. What is your forecast for US Housing Starts in March 2021? c. Economists consider the official US "Great Recession" to have started in December 2007 and ended June 2009. Using your equation in part b., create a new independent categorical variable called "Great Recession and estimate a new regression equation that includes this new variable. Using a Line Chart, plot the original time series and your new Predicted US Housing Starts. Type your estimated regression equation using a text box. What is your forecast for US Housing Starts in March 2021? d. Using the original US Housing Starts data, create three new lagged variables "Starts(t-1)" "Starts(t-2)" and "Starts(t-3). Estimated an Autoregression regression using the regression tool in the Data Analysis tab with US Housing Starts as a function of the three lagged variables. Using a Line Chart, plot the original time series and the Predicted US Housing Starts. Type your estimated regression equation using a text box. What is your forecast for US Housing Starts in March 2021? 1 Month Year US Housing Starts 2 Jan 1990 99.2 3 Feb 1990 86.9 4 Mar 1990 108.5 5 Apr 1990 119.0 6 May 1990 121.1 7 Jun 1990 117.8 8 Jul 1990 111.2 9 Aug 1990 102.8 10 Sep 1990 93.1 11 Oct 1990 94.2 12 Nov 1990 81.4 13 Dec 1990 57.4 14 Jan 1991 52.5 15 Feb 1991 59.1 16 Mar 1991 73.8 17 Apr 1991 99.7 18 May 1991 97.7 19 Jun 1991 103.4 20 Jul 1991 103.5 21 Aug 1991 94.7 22 Sep 1991 36.6 23 Oct 1991 101.8 24 Nov 1991 75.6 25 Dec 1991 65.6 26 Jan 1992 71.6 27 Feb 1992 78.8 28 Mar 1992 111.6 29 Apr 1992 107.6 30 May 1992 115.2 31 Jun 1992 117.8 32 Jul 1992 106.2 33 Aug 1992 109.9 34 Sep 1992 106.0 35 Oct 1992 111.8 36 Nov 1992 84.5 37 Dec 1992 78.6 38 Jan 1993 70.5 39 Feb 1993 74.6 40 Mar 1993 95.5 41 Apr 1993 117.8 42 Mav 1993 120.9 Sheet1 + e. The actual US Housing Starts number for March 2021 was just recorded as 144.4. Which of your forecasts, from your different models in b., c., and d., appears to be the best forecast? Which of your models do you believe would be the better model to forecast the number for April 2021? Use a text box to explain your answer. A + 100%
