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Forecasting Problem Set
F-1 Weekly income for Quiet Mental Breakdown, an online psychology firm, is provided below. Determine, on the basis of minimizing the mean square error, whether a three-period or four-period simple moving average gives a better forecast.
Week
Income
1
980
2
1040
3
1120
4
1050
5
960
6
990
7
1030
8
1260
9
1240
10
1100
F-2 Using the table above, what is your forecast for week 11 using a three-period weighted average with weights of .6, .3 and .1? The weights are stated from the most current time period to the oldest time period.
F-3Using the table above, with smoothing constants of α = .10 and then α = .30, forecast income for week 11 using exponential smoothing.
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