Cash bonuses paid to financial investment employees were reduced during the 2007 economic recession and have shown signs of rebounding with the recent recovery. The following data show the average cash bonus, in thousands of dollars, for New York City investment employees over an eight year period. These data can also be found in the Excel file average bonus. xlsx.

a. Using a three period simple moving average, forecast the average cash bonus for a financial investment employee in New York City in 2013.
b. Calculate the MAD for the forecast in part a.
c. Using a two period weighted moving average with the weights 3 and 2, forecast the average cash bonus for a financial investment employee in New York City in 2013.
d. Calculate the MAD for the forecast in part c.
e. Which forecast do you have most confidence in?

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Year 2005 2006 2007 2008 Average Bonus ($000) 149.8 1914 Year 2009 2010 2011 2012 Average Bonus ($000) 140.6 139.0 100.9 121.9