Vacation destinations often run on a seasonal basis, depending on the primary activities in that location. Amanda Wang is the owner of a travel agency in Cincinnati, Ohio. She has built a database of the number of vacation packages (Vacation) that she has sold over the last 12 years. The accompanying file includes quarterly data on the number of vacation packages sold.

Click here for the Excel Data File

Estimate the linear regression models using seasonal dummy variables with and without the trend term. Which is the preferred model?

Use the preferred model to forecast the quarterly number of vacation packages sold in the first two quarters of 2020.

Note: Round coefficient estimates to at least 4 decimal places and final answers to 2 decimal places.

date	forecast
quarter 1
quarter 2

Year	Quarter	Vacation
2008	1	530
2008	2	177
2008	3	1344
2008	4	703
2009	1	1014
2009	2	614
2009	3	1479
2009	4	1155
2010	1	239
2010	2	488
2010	3	1387
2010	4	574
2011	1	513
2011	2	310
2011	3	1422
2011	4	810
2012	1	370
2012	2	1033
2012	3	1722
2012	4	813
2013	1	811
2013	2	439
2013	3	1687
2013	4	822
2014	1	701
2014	2	799
2014	3	1098
2014	4	550
2015	1	646
2015	2	805
2015	3	1245
2015	4	544
2016	1	262
2016	2	522
2016	3	1611
2016	4	1058
2017	1	581
2017	2	899
2017	3	1144
2017	4	506
2018	1	435
2018	2	442
2018	3	1151
2018	4	584
2019	1	696
2019	2	759
2019	3	1313
2019	4	953