The way a seasonal index is computed involves which of the following steps?

A) Remove the effect of seasonal and random variation by regression analysis.
B) For each time period,compute the ratio, which removes most of the trend variation for that time period.
C) Calculate the average of all the ratios: over all time periods to remove random variation and leaving a measure of seasonality.
D) All of these choices are true.

Seasonal Index

A measure used in time series analysis to adjust for seasonal variation in data, often applied to forecast and analyze patterns that repeat over a standard cycle, such as a year.

Regression Analysis

A statistical method used for estimating the relationships among variables, often for predicting a dependent variable from one or more independent variables.

Trend Variation

The component of a time series that shows the underlying direction or path that data points are moving over time, disregarding random variations.