Question: 1 . The following data covers 3 0 periods ( could be years or quarters or months ) for company ABC s sales in $millions.

1. The following data covers 30 periods (could be years or quarters or months) for company
ABCs sales in $millions.
Period Sales(Y)
165
270
375
480
575
670
785
880
988
1090
1185
12100
13105
14102
1598
16105
17108
18115
19118
20120
21122
22128
23130
24125
25132
26135
27138
28145
29140
30138
4. Run 4-period and 5-period moving average forecasts for the above sales data and
compare the forecasts using MAD, MAPE, MSE, RMSE. Forecast for one period
ahead (beyond the sample). Also calculate the Mean Percentage Error (MPE) for
MA(4) and MA(5) forecasts and discuss the systematic bias (if any) illustrating with the
plot of actual vs forecasted values and plots of errors for both MA(4) and MA(5)
forecasts. Why do you think such a systematic biases, if any, may occur?
5. Correct this bias by performing a Double Moving Average method with four periods
and plot the errors of DMA(4). Calculate its MAD, MAPE, MSE, RMSE, and MPE
and compare with simple MA(4) forecast. Make a forecast for period 26(one period
beyond the sample) using DMA(4).

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