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Banana prices. The price of bananas fluctuates on the world market. Here are the prices ($/tonne) for the years 2000-2004. (Source: Holy See Country Review, 2008).
2000
2001
2002
2003
2004
422.27
584.70
527.61
375.19
524.84
a) Find a 3-year moving average prediction for the price in 2005.
b) Find a prediction for 2005 with an exponential smoothing model with a = 0.4.
c) The actual price of bananas in 2005 was 577 $/tonne (you can find current prices at www.imf.org/external/np/ res/commod/table3.pdf.) Compute the absolute percentage error for each prediction.
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