Consider the following time series data.
Week
1
2
3
4
5
6
Value
18
13
16
11
17
14
(a)
Choose the correct time series plot.
(i)
(ii)
(iii)
(iv)
(b)
Develop a three-week moving average for this time series.
Compute MSE and a forecast for week 7.
Do not round intermediate calculations. If required, round your
answers to two decimal places.
Week
Value
Forecast
1
18
2
13
3
16
4
11
5
17
6
14
MSE:
The forecast for week 7:
(c)
Use α = 0.2 to compute the exponential
smoothing values for the time series. Compute MSE and a forecast
for week 7.
Do not round intermediate calculations. If required, round your
answers to two decimal places.
Week
Value
Forecast
1
18
2
13
3
16
4
11
5
17
6
14
MSE:
The forecast for week 7:
(d)
Compare the three-week moving average forecast with the
exponential smoothing forecast using α = 0.2.
Which appears to provide the better forecast based on MSE?
(e)
Use trial and error to find a value of the exponential
smoothing coefficient α that results in a
smaller MSE than what you calculated for α = 0.2.