Question
If a time series exhibits a cyclical pattern that does
not follow a fixed period (e.g., economic cycles), which of the following decomposition methods would be most appropriate?Solution
STL (Seasonal-Trend decomposition using LOESS) is a robust method for decomposing time series data, particularly when the seasonality is not fixed or follows irregular cycles, such as economic cycles. Unlike traditional methods like classical decomposition, which assume a fixed seasonal period, STL uses locally weighted regression (LOESS) to estimate the seasonal and trend components, making it flexible and capable of handling non-constant seasonal patterns. STL can handle both long-term trends and irregular, cyclical components, making it an ideal choice for data with variable seasonality or unpredictable cycles. Why Other Options Are Incorrect: • A: Classical decomposition assumes fixed seasonality and may not be effective for cyclical patterns that do not follow a regular period. • B: X-11 decomposition is a variation of classical decomposition and is also designed for regular seasonality, making it unsuitable for irregular cycles. • D: While Seasonal-Trend decomposition using LOESS (STL) is robust, it is the best option for irregular seasonality, making this method the most appropriate. • E: ARIMA decomposition is designed for models involving autoregressive, differencing, and moving averages but does not explicitly handle irregular seasonal or cyclical patterns.
When was the Liberalised Remittance Scheme introduced?
What does the two way rates quoted as 1$=82.10/11 ₹, mean?
Strategic Risk can be classified as _______
The stage of communication model in which easy and less technical jargons are used before the communication for smooth flow of communication is ______
The key areas to be monitored under the Revised Prompt Correction Action framework of RBI does not include _____
If the exchange rate between USD and INR is quoted as 1 USD = Rs.83, it is _________ while when it is quoted as Rs.100 = USD 1.21, it is __________.Â
The debt instruments that allow Indian companies to raise money in local currency (INR) from foreign investors are called ______.
The Narasimham Committee was appointed to review and examine the:
1)Â Â Â functioning of the regional rural banks
2)Â Â Â progress ...
Calculate the Inventory Turnover Ratio
In the case of a forward contract , the actual risk arises and is managed on: