Using the DJIA data in Problem 5-39, use exponential smooth with trend adjustment to forecast the opening DJIA value for 2014. Use α = 0.8 and β = 0.2. Compare the MSE for this technique with the MSE for the trend line.
In Problem 5-39, The following table provides the Dow Jones Industrial Average (DJIA) opening index value on the first working day of 1994–2013: Develop a trend line and use it to predict the opening DJIA index value for years 2014, 2015, and 2016. Find the MSE for thismodel.

  • CreatedMay 16, 2014
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