Classical Decomposition Model

Classical Decomposition Method for Calloway Golf (1995-1999) For this paper I have gathered quarterly data on the sales of Calloway Golf Company from 1995 to the third quarter of 1999,and will attempt to fit a time series model using the Classical Decomposition Method, which uses a multifactor model shown below: Yt = f(T,C,S,e) where Yt = actual value of the time series at time t f = mathematical function of T = trend C = cyclical influences …

…is very high and the R-squared is quite low, so I would conclude that the model is not a very good fit. Conclusion While it was difficult to say from looking at the plot of the data whether the seasonal influences where additive or multiplicative, the analysis of the RSE and the R-squared reinforced my hypothesis that the model with the best fit for the quarterly data of Calloway Golf is the multiplicative decomposition method.