The Accuweather Corporation manufactures barometers and thermometers for weather forecasters. In an attempt to forecast its future needs for mercury, Accuweather's chief economist estimated average monthly mercury needs as: N = 500 + 10X
where N = monthly mercury needs (units) and X = time period in months (January 2005 = 0). The following monthly seasonal adjustment factors have been estimated using data from the past ve years:
Month Adjustment Factor
January 15%
April 10%
July -20%
September 5%
December -10%
a. Forecast Accuweather's mercury needs for January, April, July, September, and December of 2007.
b. The following actual and forecast values of mercury needs in the month of November have been recorded:
Year Actual Forecast
2004 456 480
2005 324 360
2006 240 240
What seasonal adjustment factor should the firm use for November?