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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › average seasonal variation(F2)
Hi sir john…how are you..i hope you will be fine..i have a question in my mind why it is necessary to calculate the average of seasonal variation…and why the sum of average seasonal variation(in additive model) should be equal to zero??what is reason behind it
We calculate the average because from year to year the variation is not the same (in a perfect world it would be, but things are not perfect in the real world 🙂 )
They should add up to zero because they are all averages and some are below zero (negative) and some are above zero (positive).
thanks sir john.. 🙂
what do you mean by perfect world and real world…??
A perfect world is an ideal world where everything operates perfectly. In real life things don’t work perfectly.