BUSINESS ADMINISTRATION
BUSINESS ANALYTICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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shows a periodic pattern lasting one year or less
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does not vary with respect to time
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shows a periodic pattern lasting more than one year
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is characterized by a linear variation of the dependent variable with respect to time
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Detailed explanation-1: -Long-term variations in time-series data that repeat in a reasonably systematic way over time. The cyclical component can often be represented by a wave-shaped curve, which represents alternating periods of expansion and contraction.
Detailed explanation-2: -A cyclic pattern exists when data exhibit rises and falls that are not of fixed period. The duration of these fluctuations is usually of at least 2 years. Think of business cycles which usually last several years, but where the length of the current cycle is unknown beforehand.
Detailed explanation-3: -An observed time series can be decomposed into three components: the trend (long term direction), the seasonal (systematic, calendar related movements) and the irregular (unsystematic, short term fluctuations).
Detailed explanation-4: -Many people confuse cyclic behaviour with seasonal behaviour, but they are really quite different. If the fluctuations are not of a fixed frequency then they are cyclic; if the frequency is unchanging and associated with some aspect of the calendar, then the pattern is seasonal.