Discussion Quections

1. Figure 12.9 shows summer air visibility measurements for denver. The acceptable visibility
standard is 100, with readings above 100 indicating clean air and good visibiIity and
readings below 100 indicating tcmperature inversions, forest tires, volcanic cruptions, or
collisions with coments

a. Is these a trend in the data? Which time series techniques might be appropriate for
estimating the average of these data?

b. A medical center for asthma and respiratory diseases located in denver has great
demand for Its services when air quality is poor. If you were in charge of developing a
short-term (say, 3-day) forecast of visibility, which causal factor(s) would you analyze? In
other words, which external factors hold the potential to significantly affrect visibility in
the short term?

c. Tourism, an important factor in Denver’s economy, is affected by the city’s image. Air
quality, as measured by visibility, affects the city’s image. If you were responsible for
development of tourism, which causal factor(s) would you analyze to forecast visibility
for the medium term (say, the next two summers)?

d. The federal government threatens to withhold several hundred million dollars in

department of transportation funds unless Denver meets visibility standards within
 eight years. How would you proceed to generate a 1ong-terrn judgment forecast of
technologies that will be available to improve visibility in the next ten years?

2. Kay and Michael passé publish what’s Happering? A biweekly newspaper to publicize
local events. What’s Happening? Has few subscribers; it typically is sold at checkout
stands. Much of the revenue comes from advertisers of garage sales and supermarket
specials. Inan effort to reduce costs associated with printing too many papers or
delivering them to the wrong Location, Michael implemented a computerized system
to collect sales data. Sales-counter scanners accurately record sales data for each
location. Since the system was implemented, total sales volume has steadily declined.
Selling advertising space and maintaining shelf space at supermarkets are getting
more difficult.

Reduced revenue makes controIling costs all the more important. For each issue.
Michael carefully makes a forecast based on sales data collected at each location.
Then he orders papers to be printed and distributed in quantities matching the
forecast. Michael’s forecast reflects a downward trend, which is present in the sales
data. Now onIy a few papers are left over at only a few locations. Althought the
sales forecast accurately predict the actual sales at most locations, What Happening?
is spiraling toward oblivion, Kay suspects that Michael is doing something wrong in
preparing the forecast but can find no mathematical errors. Tell her what’s happening.