Well, this seems to be good news for the sales team: rising sales! Yet, how does this model arrive at those numbers? To understand what is going on we will now rebuild the model. Basically, everything is in the name already:

auto-regressive, i.e. a(linear) regressionon (a delayed copy of) itself (autofrom Ancient Greekself)!So, what we are going to do is create a delayed copy of the time series and run a linear regression on it. We will use the

`lm()`

function from base R for that (see also Learning Data Science: Modelling Basics).

Read on for some additional understanding.

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