Time Series Analysis Test 1

Question 1

The graph of a time series is referred to as

Accepted Answer

Historigram

Answer

A historigram is the specific term for a graphical representation of a time series, where data points are plotted against time. It typically uses a line graph to show the evolution of a variable over successive time intervals. While it is a type of line graph, "historigram" is the more precise term in time series analysis for depicting data over time.

Question 2

The secular tendency has undergone the following movement(s).

Accepted Answer

All of the above

Answer

The secular tendency, also known as the long-term trend, describes the general direction or movement of a time series over an extended period. This movement is typically characterized as regular, steady, and smooth, indicating a consistent underlying pattern of growth or decline, rather than short-term fluctuations. Therefore, all listed descriptions apply to the secular tendency.

Question 3

In a business, prosperity, recession, and depression are examples of this.

Accepted Answer

Cyclical Component

Answer

Prosperity, recession, and depression are all stages of the business cycle, which represents the cyclical component of a time series. These are medium-term fluctuations in economic activity that typically last longer than a year but are not as long-term as a secular trend. They reflect the ebb and flow of the economy, driven by various economic factors.

Question 4

Moving averages are used to calculate the secular trend:

Accepted Answer

Smooth out the time series

Answer

Moving averages are primarily used in time series analysis to smooth out short-term fluctuations and irregular variations in the data. By averaging values over a specific period, they help to reveal the underlying long-term trend (secular trend) more clearly, making it easier to identify the general direction of the series. This process filters out noise to highlight the main pattern.

Question 5

According to time series theory, a shortage of specific consumer items prior to the yearly budget is caused by

Accepted Answer

Seasonal Component

Answer

A shortage of specific consumer items prior to a yearly budget, if it occurs consistently around the same time each year, is an example of a seasonal component. This predictable pattern is often driven by annual events, such as pre-holiday shopping surges or anticipatory buying before a new fiscal year's price adjustments. It's a recurring short-term variation tied to the calendar.

Time Series Analysis Practice Test

Time Series Analysis Practice Test

Time Series Analysis Test 1