28/04/2328/04/23 Q.M.M.Q.M.M. 11

28/04/23 Q.M.M. 2

Analysis of Time Series

Presented By,Subeesh.P.S.Sivaraman.P.S.

28/04/23 Q.M.M. 3

Time Series

It refers to values of a variable chronologically ordered, over a successive period of time.It is dynamic distribution of which reveals good deal of variations over time.

28/04/2328/04/23 Q.M.M.Q.M.M. 44

Analysis of Time Series Analysis of Time Series It is a statistical device used to understand, interpret, and It is a statistical device used to understand, interpret, and

evaluate changes in economic phenomena over time, with evaluate changes in economic phenomena over time, with

the hope of more correctly anticipating the course of future the hope of more correctly anticipating the course of future

events.events.

It is done to understand the dynamic conditions of the It is done to understand the dynamic conditions of the

variables that is being considered.variables that is being considered.

28/04/2328/04/23 Q.M.M.Q.M.M. 55

Importance of Time Series Importance of Time Series AnalysisAnalysis

It discloses the change in time & It discloses the change in time & change in values of variables.change in values of variables.It helps in understanding the past It helps in understanding the past behaviour.behaviour.It helps in predicting, forecasting & It helps in predicting, forecasting & planning.planning.It helps in evaluating current It helps in evaluating current programmes.programmes.It facilitates comparison.It facilitates comparison.

28/04/2328/04/23 Q.M.M.Q.M.M. 66

Components of Time SeriesComponents of Time Series

Secular Trend.Secular Trend.

Seasonal Variations.Seasonal Variations.

Cyclic Variations.Cyclic Variations.

Irregular Variations.Irregular Variations.

28/04/2328/04/23 Q.M.M.Q.M.M. 77

Secular TrendSecular Trend Secular TrendSecular Trend, or , or Long Term TrendLong Term Trend, is the basic , is the basic

tendency of a series to grow or decline over a period of tendency of a series to grow or decline over a period of time.time.

It does not include short range oscillations.It does not include short range oscillations. It may also fluctuate about a constant level that does It may also fluctuate about a constant level that does

not change with the passage of time.not change with the passage of time. Eg: - Rainfall in a locality would Eg: - Rainfall in a locality would

fluctuate; but it will not rise or fall with fluctuate; but it will not rise or fall with the passage of time.the passage of time.

Q.M.M. 828/04/23

Seasonal Variations Seasonal variations are those variations

which occur, with some degree of regularity within a specified period of one year or shorter.

Almost every business & economic activity is vulnerable to seasonal variations.

They are quite regular & uniform and can be predicted with some amount of accuracy.

28/04/2328/04/23 Q.M.M.Q.M.M. 99

Factors Factors ResponsibleResponsible

Climate and Weather Conditions.Climate and Weather Conditions.Customs, Traditions & Habits.Customs, Traditions & Habits.

Climate and Weather Conditions.Climate and Weather Conditions. Eg: - Sales of Umbrella will be more in Rainy Eg: - Sales of Umbrella will be more in Rainy

Seasons.Seasons.Customs, Traditions & Habits.Customs, Traditions & Habits.

Eg: - On Occasions of Deepavali, Christmas etc, Eg: - On Occasions of Deepavali, Christmas etc, there is great demand for the sweets and gifts.there is great demand for the sweets and gifts.

28/04/23 Q.M.M.10

Cyclic Variations Cyclical variations refer to recurring

pattern of changes in events over the period extending beyond an year.

The knowledge of cyclical fluctuations is very useful in predicting the turning points in business activity.

Due to lack of uniformity in cyclical period, we cannot forecast them accurately.

28/04/23 Q.M.M. 11

Irregular Variations They are those variations that results

as a part of unexpected, unusual, catastrophic or accidental events.

All types of events that are not accounted for by trend, seasonal and cyclic variations are include in this category.

Effects of earthquakes, floods, epidemics, strikes, lock outs…etc.

28/04/23 Q.M.M. 12

Analysis of Time Series in Business

Primary Purpose: - to discover & measure all types of variations in business which characterises a time series.Central Objective: - to decompose the various elements present in a time series and to use them for business decision making.

Q.M.M.Q.M.M. 131328/04/2328/04/23