Question

Paula’s computer is randomly generating a number between 1 and 100 every five minutes. Paula wants to use a moving average model using the last six numbers the computer generated to forecast the computer’s next number. Is this an appropriate use of the moving average model? Why or why not?

Answer 1

Yes , this is an appropriate use of the moving average model.

Simple Moving Average is the average obtained from the data for some t period of time . In normal mean, it’s value get changed with the changing data but in this type of mean it also changes with the time interval . We get the mean for some period t and then we remove some previous data . Again we get new mean and this process continues . This is why it is moving average .

For above senerio, We can use Moving average model because we are using time interval to conduct model.