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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › Seasonal variations
Sir In text book there is a particular paragraph in disadvantage of time series that seasonal variations are constant.
My question is whether seasonal variations are constant or not .
They are very unlikely to be constant. If sales are increasing then the seasonal variations are likely to increase also when using the additive model. The multiplicative model would be better in this situation, but even then the variations are unlikely to be constant. That is why in both cases we calculate the average seasonal variations.
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