Question

Consider the following time series data.

Week	1	2	3	4	5	6
Value	18	13	15	12	16	14

c)Use α = 0.2 to compute the exponential smoothing forecasts for the time series.

Week	Time Series Value	Forecast
1	18
2	13	18
3	15
4	12
5	16
6	14

Compute MSE. (Round your answer to two decimal places.)

MSE =____

What is the forecast for week 7? (Round your answer to two decimal places.)

____

(e)Use a smoothing constant of α = 0.4 to compute the exponential smoothing forecasts.

Week	Time Series Value	Forecast
1	18
2	13	18
3	15
4	12
5	16
6	14

Answer 1

c)

Time period	Actual Value(A)	Forecast(F)	Forecast error E=A-F	Squared Forecast Error
1	18
2	13	18.00	5.00	25.00
3	15	17.00	2.00	4.00
4	12	16.60	4.60	21.16
5	16	15.68	0.32	0.10
6	14	15.74	1.74	3.04
		Total	13.66	53.30
		Average	2.73	10.66
			MAD	MSE
MSE =			10.66
forecast for week 7 =			15.39

e)

Time period	Actual Value(A)	Forecast(F)
1	18
2	13	18.00
3	15	16.00
4	12	15.60
5	16	14.16
6	14	14.90

MSE =

8.63