Financial Risk Manager Part 1

Explanation:

Seasonality arises from various factors that have links to the normal calendar year:

1. Technologies linked to the calendar - For example, agricultural technologies that rely on weather patterns are seasonal.
2. Preferences with links to the calendar - Most people prefer summer vacations to winter ones, leading to seasonal patterns in travel and gasoline prices.
3. Social events with links to the calendar - Events like Christmas and Eid Mubarak lead to spikes in retail goods prices.

Since all three factors (technologies, preferences, and social events) can bring about seasonality, the correct answer is D) All of the above.

Key Points:

• Seasonality refers to predictable patterns that repeat at regular intervals, typically tied to calendar cycles
• These patterns can be observed in various economic, financial, and business data
• Understanding seasonality is important for accurate forecasting and risk management