Question

You are given the following information on the past history of the exchange rate between the U.S. dollar and the Japanese yen.

10/19: ¥109.00: $1; 10/20: ¥109.20: $1; 10/21: ¥109.70: $1; 10/22: ¥110.00: $1; 10/23: ¥110.50: $1

(1) Calculate the 5-day moving average (MA) of the exchange rate on October 23. (2) Calculate the 4-day MA of the exchange rate on October 22.
(3) Calculate the 3-day MA of the exchange rate on October 21.
(4) Explain how you would get a 60-day MA of the exchange rate on October 23.

Answer 1

Ans

1) 5-day moving average (MA) of the exchange rate on October 23.

= (109 + 109.20 + 109.70 + 110 + 110.50) ÷ 5

= ¥109.68

2)  4-day MA of the exchange rate on October 22.

= (109 + 109.20 + 109.70 + 110) ÷ 4

= ¥109.475

3)  3-day MA of the exchange rate on October 21.

= (109 + 109.20 + 109.70) ÷ 3

= ¥109.3

4) so to find the moving average on rate of October 23. We have take average of 60 day exchange rate till oct 23 or on before day.

Example :- till October 23. 60 day start from 24 August to 23 October.

So here we have calculate all 60 days exchange rate and than divide this by number of day means 60 day.