BE314 Financial modelling

Part A -  QUESTION 1 Construct a line chart for your given brand of rice. Comment on any features of interest.  QUESTION 2 Estimate a model of volume sales using a trend component. In other words, estimate the following: Where yt = Volume sales in period tT = Trend Comment on your findings. How do your findings for the trend variable compare to your observations in Question 1?  Hint : To complete this step, you must create a trend variable. QUESTION 3 Refine the model you created in Question 2 by adding a seasonal index. In other words, estimate the following: Where SI = Seasonal Index Are there any months that exhibit above average sales? What do you think is the reason? How do your findings compare to your observations in step 1? Comment on your findings. Hint : To complete this step, you must create a seasonal index. QUESTION 4 In the middle of 2005, the outbreak of a new disease Rhizoctonia Solani had a devastating impact on the rice farming industry all over the world. Known as ‘Sheath Blight’, fear of the disease quickly spread throughout China causing people to avoid consumption of certain brands of rice. Many consumers sought alternative food such as bread as a substitute during the one year of the plague. At the same time, sales of certain brands of rice were not affected due to the country of production