Question

Problem 3-20

An analyst must decide between two different forecasting techniques for weekly sales of roller blades: a linear trend equation and the naive approach. The linear trend equation is F_t = 127 + 2.1t, and it was developed using data from periods 1 through 10. Based on data for periods 11 through 20 as shown in the table, which of these two methods has the greater accuracy if MAD and MSE are used? (Round your answers to 2 decimal places.)

      

t

Units Sold

11

145

12

150

13

148

14

143

15

154

16

149

17

152

18

156

19

158

20

164

MAD (Naive)=
MAD (Linear)=
MSE (Naive)=
MSE (Linear)=

Answer 1

The naive method provides forecasts with less average error and less average and squared error