Question 1

What does a time series refer to?

Accepted Answer

A sequence of observations recorded at regular intervals over time.

Answer

A random collection of data points.

Answer

A method of data cleaning.

Answer

A type of statistical software.

Question 2

Which component represents random variation in a time series?

Accepted Answer

Irregular component.

Answer

Cyclical component

Answer

Trend component

Answer

Seasonal component

Question 3

What does the trend component indicate?

Accepted Answer

The long-term direction of a time series over an extended period.

Answer

Short-term fluctuations in data.

Answer

The average of random data points.

Answer

Seasonal variations.

Question 4

In a multiplicative model, how is a time series expressed?

Accepted Answer

Yt = Tt × Ct × St × It.

Answer

Yt = Tt - Ct + St - It.

Answer

Yt = Tt + Ct + St + It.

Answer

Yt = Ct + St × Tt.

Question 5

What is a common method used to remove seasonal variations?

Accepted Answer

Deseasonalization.

Answer

Differencing.

Answer

Normalization.

Answer

Smoothing.

Question 6

What does an additive model suggest about seasonal variations?

Accepted Answer

The components of the series are interacted in an additive manner.

Answer

All components are constant.

Answer

The components are independent.

Answer

The seasonal variation depends on the data level.

Question 7

What signifies an upward linear trend in the context of time series?

Accepted Answer

When the slope (b) is greater than 0.

Answer

When the slope (b) is less than 0.

Answer

When the slope (b) is equal to 0.

Answer

When the trend line is horizontal.

Question 8

What is the purpose of calculating seasonal indices?

Accepted Answer

To measure the seasonal effect for each period.

Answer

To determine the average sales.

Answer

To identify irregular components.

Answer

To analyze long-term trends.

Question 9

What distinguishes cyclical movements from seasonal movements?

Accepted Answer

Cyclical movements last longer than one year.

Answer

Cyclical movements are predictable.

Answer

Cyclical movements are always upward.

Answer

Cyclical movements occur within a year.

Question 10

How is the irregular component calculated in a time series?

Accepted Answer

It is computed by removing the trend and seasonal effects from the actual data.

Answer

By averaging the seasonal indices.

Answer

By applying a moving average.

Answer

By summing all observed values.

Question 11

A time series is best defined as:

Accepted Answer

A sequence of observations collected at regular time intervals

Answer

A dataset organized by category rather than time

Answer

A type of cross-sectional data

Answer

A random collection of values with no time reference

Question 12

In the expression Yt = f(t) + εt, the term εt represents:

Accepted Answer

Random or irregular variation

Answer

Seasonal variation

Answer

Trend component

Answer

Cyclical movement

Question 13

Which assumption is fundamental in forecasting based on time series?

Accepted Answer

Past patterns tend to repeat over time

Answer

Time series do not contain randomness

Answer

Random shocks are predictable

Answer

All future values are constant

Question 14

The multiplicative decomposition model is written as:

Accepted Answer

Y_t = T_t 	imes S_t 	imes C_t 	imes I_t

Answer

Yt = Tt + St + Ct + It

Answer

Yt = St - Tt + Ct - It

Answer

Yt=Tt+St

Question 15

Which model is appropriate when seasonal variations increase as the data level increases?

Accepted Answer

Multiplicative

Answer

Linear

Answer

Additive

Answer

Stationary

Question 16

The trend component represents:

Accepted Answer

Long-term movement or direction in the data

Answer

Seasonal variations

Answer

Short-term fluctuations

Answer

Random variation

Question 17

A trend equation of the form Tt = a + bt is known as:

Accepted Answer

Linear trend

Answer

Logistic trend

Answer

Exponential trend

Answer

Quadratic trend

Question 18

If slope b < 0 in a linear trend equation, it indicates:

Accepted Answer

Downward trend

Answer

No trend

Answer

Seasonal effect

Answer

Upward trend

Question 19

Moving averages are used primarily to:

Accepted Answer

Smooth data by reducing irregular variations

Answer

Remove long-term trend

Answer

Remove seasonal patterns only

Answer

Increase fluctuations

Question 20

Which moving average period is centered naturally on the middle observation?

Accepted Answer

Odd-number periods

Answer

Weighted moving average

Answer

Even-number periods only

Answer

Two-period average

Question 21

What is the nature of seasonal variations?

Accepted Answer

Regularly within each year

Answer

Randomly with no pattern

Answer

Only every 10 years

Answer

At unpredictable intervals

Question 22

Which industry commonly shows strong seasonality?

Accepted Answer

Tourism

Answer

Telecommunications

Answer

Mining

Answer

Real estate

Question 23

What does a seasonal index (SI) of 100 represent?

Accepted Answer

SI = 100 means average season

Answer

SI < 100 must equal a peak period

Answer

SI > 100 means below average

Answer

SI = 0 means no seasonality

Question 24

How are deseasonalised values calculated in a multiplicative model?

Accepted Answer

Yt / (SIt/100)

Answer

Yt + SI

Answer

Yt × SI

Answer

Yt − SI

Question 25

Why are centered moving averages (CMA) used in seasonal calculations?

Accepted Answer

To align trend-cycle with correct time period

Answer

To eliminate long-term cycles

Answer

To exaggerate randomness

Answer

To adjust future forecasts

Question 26

What should you do if the unadjusted seasonal indices sum to 405 for a quarterly series?

Accepted Answer

Multiply each index by 400/405

Answer

Add 5 to each index

Answer

Delete one index

Answer

Divide each by 4

Question 27

What does the cyclical component of economic fluctuations refer to?

Accepted Answer

Last more than one year and move around trend

Answer

Are predictable like seasonality

Answer

Represent random shocks

Answer

Occur within a year

Question 28

Which phase of the business cycle indicates the highest level of economic activity?

Accepted Answer

Peak

Answer

Recovery

Answer

Contraction

Answer

Trough

Question 29

How are cyclical ratios calculated?

Accepted Answer

Yt/(Tt x St) x 100

Answer

Yt/Tt

Answer

Tt/Yt

Answer

Yt/SIt

Question 30

What does a cyclical ratio of 108% indicate?

Accepted Answer

Strong expansion

Answer

Below-trend activity

Answer

No deviation

Answer

Mild recession

Question 31

Which of the following is NOT a characteristic of cyclical movements?

Accepted Answer

Occur regularly every month

Answer

Long wave-like pattern

Answer

Irregular in length and amplitude

Answer

Caused by business cycles

Question 32

The irregular component represents:

Accepted Answer

Random&#44; unpredictable events

Answer

Trend movement

Answer

Predictable seasonal variations

Answer

Long-term economic cycles

Question 33

Which event will most likely produce a strong irregular effect?

Accepted Answer

COVID-19 lockdown

Answer

Annual monsoon season

Answer

Ramadan

Answer

School holiday

Question 34

Irregular component is computed in multiplicative form as:

Accepted Answer

It=Yt/(Tt×St)

Answer

Y_t = T_t 	imes S_t 	imes C_t 	imes I_t

Answer

It=Tt/Yt

Answer

Y_t = T_t 	imes S_t 	imes C_t 	imes I_t

Question 35

If I_t = 1.20, this suggests:

Accepted Answer

Actual value is 20% above expected

Answer

No irregular variation

Answer

Cyclical downturn

Answer

Actual value is 20% below expected

Question 36

What is the primary purpose of a moving average?

Accepted Answer

Observations collected at regular intervals over time

Answer

Values grouped by categories

Answer

Random values with no time connection

Answer

Data collected at one point in time

Question 37

In a multiplicative model, the series is expressed as:

Accepted Answer

Y_t = T_t 	imes S_t 	imes C_t 	imes I_t

Answer

Yt=St/Tt

Answer

Y_t = T_t 	imes S_t 	imes C_t 	imes I_t

Answer

Y_t = T_t 	imes S_t 	imes C_t 	imes I_t

Question 38

How do seasonal variations behave?

Accepted Answer

Repeat at fixed intervals within a year

Answer

Show no predictable pattern

Answer

Represent long-term economic cycles

Answer

Occur randomly

Question 39

Cyclical variations typically last:

Accepted Answer

Between 2 to 10 years

Answer

Only a few days

Answer

Less than 12 months

Answer

Exactly 1 year

Question 40

The irregular component (Iₜ):

Accepted Answer

Represents unpredictable shocks

Answer

Represents seasonal effects

Answer

Repeats every year

Answer

Measures long-term trend

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