(c) Suppose you are allowed to choose any weights as long as they sum to 1. Could you always find a set of weights that would make the MSE at least as small for a weighted moving average than for an unweighted moving average? Why or why not? O Yes, because an unweighted moving average just a weighted moving average where the weights are equal. O Yes, a weighted moving average always has a smaller MSE than an unweighted moving average. O No, sometimes you need to let the weights sum to a number higher/lower than 1 in order to get a smaller MSE than the one for an unweighted moving average. O No, an unweighted moving average always has a smaller MSE than a weighted moving average.

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(c) Suppose you are allowed to choose any weights as long as they sum to 1. Could you always find a set of weights that would make the MSE at least as small for a weighted moving average than for
an unweighted moving average? Why or why not?
Yes, because an unweighted moving average is just a weighted moving average where the weights are equal.
Yes, a weighted moving average always has a smaller MSE than an unweighted moving average.
No, sometimes you need to let the weights sum to a number higher/lower than 1 in order to get a smaller MSE than the one for an unweighted moving average.
No, an unweighted moving average always has a smaller MSE than a weighted moving average.
Transcribed Image Text:(c) Suppose you are allowed to choose any weights as long as they sum to 1. Could you always find a set of weights that would make the MSE at least as small for a weighted moving average than for an unweighted moving average? Why or why not? Yes, because an unweighted moving average is just a weighted moving average where the weights are equal. Yes, a weighted moving average always has a smaller MSE than an unweighted moving average. No, sometimes you need to let the weights sum to a number higher/lower than 1 in order to get a smaller MSE than the one for an unweighted moving average. No, an unweighted moving average always has a smaller MSE than a weighted moving average.
1
for the most recent observation,
2
1
for the second most recent observation, and
3
(a) Using a weight of
for third most recent observation, compute a three-week weighted moving average for the
time series. (Round your answers to two decimal places.)
Time Series
Weighted Moving
Average Forecast
Week
Value
1
19
23
3
21
4
25
5
20
6
18
7
19
8.
17
9
21
10
19
11
14
12
21
(b) Compute the MSE for the weighted moving average in part (a).
MSE =
Do you prefer this weighted moving average to the unweighted moving average? The MSE for the unweighted moving average is 10.22.
The weighted moving average is preferred because it has a smaller MSE compared to the unweighted moving average.
The weighted moving average is preferred because it has a larger MSE compared to the unweighted moving average.
The unweighted moving average is preferred because it has a smaller MSE compared to the weighted moving average.
The unweighted moving average is preferred because it has a larger MSE compared to the weighted moving average.
Transcribed Image Text:1 for the most recent observation, 2 1 for the second most recent observation, and 3 (a) Using a weight of for third most recent observation, compute a three-week weighted moving average for the time series. (Round your answers to two decimal places.) Time Series Weighted Moving Average Forecast Week Value 1 19 23 3 21 4 25 5 20 6 18 7 19 8. 17 9 21 10 19 11 14 12 21 (b) Compute the MSE for the weighted moving average in part (a). MSE = Do you prefer this weighted moving average to the unweighted moving average? The MSE for the unweighted moving average is 10.22. The weighted moving average is preferred because it has a smaller MSE compared to the unweighted moving average. The weighted moving average is preferred because it has a larger MSE compared to the unweighted moving average. The unweighted moving average is preferred because it has a smaller MSE compared to the weighted moving average. The unweighted moving average is preferred because it has a larger MSE compared to the weighted moving average.
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