# Question

Shown here are the consumer price indexes (CPIs) for housing for the years 1990 through 2011 from the Bureau of Labor Statistics Data Web site. Use the data to answer the following questions.

a. Compute the 4-year moving average to forecast the CPIs from 1994 through 2011.

b. Compute the 4-year weighted moving average to forecast the CPIs from 1994 through 2011. Weight the most recent year by 4,the next most recent year by 3, the next year by 2,and the last year of the four by 1.

c. Determine the errors for parts (a) and (b). Compute MSE for parts (a) and (b).Compare the MSE values and comment on the effectiveness of the moving average versus the weighted moving average for these data.

a. Compute the 4-year moving average to forecast the CPIs from 1994 through 2011.

b. Compute the 4-year weighted moving average to forecast the CPIs from 1994 through 2011. Weight the most recent year by 4,the next most recent year by 3, the next year by 2,and the last year of the four by 1.

c. Determine the errors for parts (a) and (b). Compute MSE for parts (a) and (b).Compare the MSE values and comment on the effectiveness of the moving average versus the weighted moving average for these data.

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