How can you explain the differences in the three forecasts

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Reference no: EM131999184

How have stocks performed in the past? The data in StockPerformance shows the performance of a broad measure of stock performance (by percentage) for each decade from the 1830s through the 2000s.

a. Plot the time series.

b. Fit a three-year moving average to the data and plot the results.

c Using a smoothing coefficient of W = 0.50, exponentially smooth the series and plot the results.

d. What is your exponentially smoothed forecast for the 2010s?

e. Repeat c and d, using W = 0.25.

f. Compare the results of d and e.

g. What conclusions can you reach about how stocks have performed in the past?

There has been much publicity about bonuses paid to workers on Wall Street. Just how large are these bonuses? The file Bonuses contains the bonuses paid (in $000) from 2010 to 2014.

a. Plot the data.

b. Compute a linear trend forecasting equation and plot the results.

c. Compute a quadratic trend forecasting equation and plot the results.

d. Compute an exponential trend forecasting equation and plot the results.

e. Using the forecasting equations in b through d, what are your annual forecasts of the bonuses for 2015 and 2016?

You should have a total of six forecasts here..

How can you explain the differences in the three forecasts in (e)? What forecast do you think you should use? Why?

Reference no: EM131999184

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