statistics - time graphs

time series graphs

A line graph with time plotted on the x-axis - used to spot trends

time series

Data collected over a period of time at equal intervals (years, quarters, months, days)

trend line

A line showing the general trend of the data

When drawing a trend line, what should you ignore?

small fluctuations - follow the general pattern (is the data going upwards or downwards)

What types of trends can a trend line show?

Rising, falling, or level

What is a moving average?

An average calculated from a set number of consecutive values

Why use moving averages?

To smooth fluctuations and show the trend more clearly

Where do you plot moving averages?

At the midpoint of the time interval

For a 3-point moving average, where is the point plotted?

At the middle of the 3 values

For a 4-point moving average, where is the midpoint?

Halfway between the 2nd and 3rd values

How should moving average points be joined?

With a line of best fit (LOBF), not straight joins

What are seasonal variations?

Patterns that repeat at the same point every cycle

What cycle lengths can seasonal variation follow?

Days, weeks, months, quarters, or seasons

What does seasonal variation measure?

How much the actual value differs from the trend

Formula for seasonal variation?

Seasonal Variation = Actual Value − Trend Value

What is EMSV?

Estimated Mean Seasonal Variation

What is another name for EMSV?

Average Seasonal Effect

How do you find EMSV?

Mean of all seasonal variations for the same season

Example of EMSV calculation?

Average of all Quarter 4 seasonal variations

How do you predict future values in time series?

Use the trend line and EMSV

Formula for predicted value?

Predicted Value = Trend Value + EMSV

Why must seasonal variation be interpreted in context?

Because real-life events can cause the pattern

Give examples of causes of seasonal variation

Weather, holidays, school terms, business cycles