The graph shows a shop's sales y, in lakh rupees, for 12 quarters t in a row, three years in all. Which components does it show most clearly? A line graph of sales y against quarters t = 1 to 12, rising overall, with a peak in the second quarter and a dip in the fourth quarter of every year.

The graph shows a shop's sales y, in lakh…

The graph shows a shop's sales y, in lakh rupees, for 12 quarters t in a row, three years in all.

Question 21

MediumOriginal question

The graph shows a shop's sales $y$ , in lakh rupees, for 12 quarters $t$ in a row, three years in all. Which components does it show most clearly?

A line graph of sales y against quarters t = 1 to 12, rising overall, with a peak in the second quarter and a dip in the fourth quarter of every year.

A falling trend with cyclical variationCorrect answerYour answerA rising trend with seasonal variationCorrect answerYour answerOnly irregular variationCorrect answerYour answerA rising trend and nothing elseCorrect answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer B

Correct answer: B

Across the three years the sales climb: each quarter is higher than the same quarter a year before. That is an upward trend.
Within each year the same pattern repeats, a peak in the second quarter and a dip in the fourth: seasonal variation.

Worth noting

The ups and downs come back every four quarters, so they are seasonal, not irregular.

Concept: Reading components from a graph
Typical timeTypical: 90 s
Your timeYours: —

The rule this testsComponents of a time series

Practise this chapter →

Ten questions from Time Series & Trend, at your own pace.

Practise this chapter →

Ten questions from Time Series & Trend, at your own pace.

The graph shows a shop's sales y, in lakh rupees, for 12 quarters t in a row, three years in all.

Question 21

Explanation