Hello, I understand how the calculations work, however, I am confused with what

Question

Hello, I understand how the calculations work, however, I am confused with what exactly to calculate due to the question being 5-15 periods, and it is asking for 4 month moving averages/Weighted moving averages. Any help would be greatly appreciated.

a. Compute forecasts for periods 5 through 15 using 4-month moving averages b. Compute forecasts for periods 5 through 15 using 4-month weighted moving averages with weights 0.4 (newest period), 0.3, 0.2, and 0.1 (oldest period) US Index of Industrial Production 108 108 110 106 108 108 105 100 97 95 95 92 95 95 98 Period 10 12 13 14 15

Explanation / Answer

a) A four period moving average method averages the actual value for the previous four periods to generate the forecast for the next period. This can be calculated as the sum of the actual value for the previous four periods / 4

Using the above formula the forecast for period 5 through 15 are

b) Using a four period weighted moving average method the forecast for a period is calculated as the sum of the product of the actual value and their respective weights for the previous four periods.

So using the above formula with weight of 0.4,0.3,0.2,0.1 assigning the highest weight to the most recent period the forecast for period 5 through 15 are

Related Questions

Navigate

• Browse (All)
• Browse H
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.