Question: F I L E Consider the following table, which shows a portion of the closing prices of the S&P 500 Index for 21 trading days

F I L E Consider the following table, which shows a portion of the closing prices of the S&P 500 Index for 21 trading days in November 2010. The complete data set can be found on the text website, labeled S&P Price.

Date S&P Price 1-Nov 1184.38 2-Nov 1193.57

⋮ ⋮

30-Nov 1180.55 Source: finance.yahoo.com .

a. Use a 3-period moving average to make a price forecast for December 1,2010.

b. Use the exponential smoothing method to make a price forecast for December 1,2010. Use α = 0.4.

c. Which of the above smoothing methods results in a lower MSE?

d. You find out that the actual S&P 500 closing price on December 1,2010 was 1,206.07. Was the forecast performance of the two methods consistent with their in-sample performance in part c?

Step by Step Solution

★★★★★

3.34 Rating (163 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Business Statistics Communicating Questions!

Explain the different ways that businesses can influence government. Which do you think is most effective? Why?

Consider the following table, which shows a portion of the closing prices of the S&P 500 Index for 21 trading days in November 2010. Date.................... S&P Price 1-Nov........................

Consider and discuss the specific risks and nature of the company you will be auditing and create comprehensive work programs for the Acquisition, Payment, Property Plant, and Equipment (Fixed...

Assignment 01 (semester 2) Assignment 01 Unique number 730716 Closing date 30 August 2021 Content Learning units 1 and 2 of the Study Guide and the relevant chapters of the prescribed book Questions...

can you please answer #45 and #56? it is from the same document from before. Exam Name___________________________________ MULTIPLE CHOICE. Choose the one alternative that best completes the statement...

please see question 53 about the amount owed in taxes the following year. Exam Name___________________________________ MULTIPLE CHOICE. Choose the one alternative that best completes the statement or...

an investment will $205,000 at the end of next year for an investment of $183,000 at the start of the year. If the market interest rate is 8% over the same period, should the investment be made?...

45. Luther Industries has a dividend yield of 4.5% and a cost of equity capital of 12%. Luther Industries' dividends are expected to grow at a constant rate indefinitely. The growth rate of Luther's...

"DISCUSS THE EFFECTS OF COVID 19 ON LABOR MARKETS AND THE ECONOMY" Provide an introduction and the background of your study, and clearly state what your research question or objective is. What real...

SUMMARY this journal, the length of it should not be more than 2 pages, with 1.5 spacing size 12 Times New Rome. Available online at www.sciencedirect.com Journal of Empirical Finance 15 (2008) 199 -...

Please summarize this journal, the length of the summary should not be more than two pages with 1.5 spacing, size 12 Times New Rome. Expert Systems with Applications 38 (2011) 11347-11354 Contents...

A diatomic ideal gas (y = 1.40) confined to a cylinder is put through a closed cycle. Initially the gas is at Pi, Vi, and Ti. First, its pressure is tripled under constant volume. It then expands...

Suppose rpr 5% rm 12% what is the appropriate required rate of return for a stock thats equal 1.5?

A soft-drink machine is regulated so that it discharges an average of 200 milliliters per cup. If the amount of drink is normally distributed with a standard deviation equal to 15 milliliters, (a)...

Access the Discovering Data exercise for Chapter 14 Problem 12 online to answer the following questions. a. What is the current level of employment for individuals without a high school diploma? b....

A company with 400 employees is going to conduct a development training program for its staff. The training program has limited seats for only 15 employees. Suggest a most common and basic form of...

With their individual tickets to attend an evening dinner, every guest has the chance to win the grand door prize. a. Which sampling method is the fairest to use to select the grand door price? b....

Produce the relative frequency distribution from a sample size of 50 that gave rise to the following ogive: 2-5. You have the following data: a. Construct a frequency distribution for these data. Use...

Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company's costs: Fixed Cost per Month...

Company CD International Ltd has two divisions, C and D. Division C operates in Country LoTax, and Division D operates in Country HiTax. Both countries use currency CU (Currency Unit). Division C...

The following four cases make different assumptions with respect to the amounts of income and deductions of Frank Denham for the current year: Employment income Case A $58,200 Case B $82,600 Case C...