The National Association of Theatre Owners is the largest exhibition trade organization in the world, representing more than 26,000 movie screens in all 50 states and in more than 20 countries worldwide. Its membership includes the largest cinema chains and hundreds of independent theater owners. It publishes statistics concerning the movie sector of the economy. The file titled Flicks contains data on average U.S. ticket prices ($). One concern is the rapidly increasing price of tickets.
a. Produce a time-series plot for these data. Specify the exponential forecasting model that should be used to obtain next year’s forecast.
b. Assuming a double exponential smoothing model, fit the least squares trend to the historical data to determine the smoothed constant-process value and the smoothed trend value for period 0.
c. Use α = 0.20 and β = 0.30 to forecast the average yearly ticket price for the year 2010.
d. Calculate the MAD for this model.