Problem $1$: Forecasting $-$ Time Series Analysis

Use TSA worksheet to answer the following questions. The data in the file contains average

monthly $30-$year mortgage rates over $82$ consecutive months.

Draw a line chart of these data.

Compute the two$-$month moving average predictions for the data set in Cell E$86.$

Compute the MSE and the MAPE in Cells E$90$ and E$92.$

Compute the two$-$month weighted moving average predictions for the data set in Cell

F$86.$ Complete Cells F$90$ and F$92.$ Use Excel Solver to determine the weights in Cells

F$96$ and F$97$ for a two$-$month weighted moving average on the data set that minimizes

the MSE.

Compute the exponential smoothing predictions for the data set in Cell G$86.$ Complete

Cells G$90$ and G$92.$ Use Solver to estimate the optimal value of $$ in Cell G$98$ for an

exponential smoothing model that minimizes the MSE.

In terms of MSE, which appears to provide the best fit for this data set?

In terms of MAPE, which appears to provide the best fit for this data set?