Table P-23 in Chapter 3 contains the quarterly income before extraordinary items for Southwest Airlines for the years 1988-1999.

a. Using Minitab, smooth the Southwest Airlines income data using Holt's linear smoothing and store the residuals. Compute the residual autocorrelations. Does it appear as if Holt's smoothing procedure represents these data well? If not, what time series component (trend, cycle, seasonal) is not accounted for by Holt's method?
b. Use Minitab to smooth the Southwest Airlines income data using Winters' multiplicative exponential smoothing. Store the residuals and generate forecasts of income for the four quarters of 2000. Compute the residual autocorrelations. Does Winters' smoothing technique fit the income data well? Do the forecasts seem reasonable? Discuss.

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TABLE P-23 Quarterly Income for Southwest Airlines (SMM) 2nd 3rd 26.59 24.57 23.04 15.72 26.89 48.83 58.62 67.72 60.86 92.51 129.64 126.98 Year 1st 4th 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 0.17 19.64 5.09 8.21 13.48 24.93 41.85 11.83 33.00 50.87 70.01 95.85 15.13 19.24 23.53 10.57 23.48 42.15 58.52 59.72 85.32 93.83 33.39 157.76 16.07 8.11 4.58 8.84 27.17 38.37 20.34 43.36 28.16 80.55 100.38 93.80