Gasoline sales Times Series week sales (1000s of gallons 1 17 2 21 3 19 4 23 5 18 6 16 7 20 8 18 9 22
|
Gasoline sales Times Series |
|
|
week |
sales (1000s of gallons |
|
1 |
17 |
|
2 |
21 |
|
3 |
19 |
|
4 |
23 |
|
5 |
18 |
|
6 |
16 |
|
7 |
20 |
|
8 |
18 |
|
9 |
22 |
|
10 |
20 |
|
11 |
15 |
|
12 |
22 |
8) Refer again to gasoline sales time series data in table 6.1
i)using a weight ½ for the most recent observation, 1/3 for the second most recent, and 1/6 for third most recent, compute a three-week weighted moving average for the time series
ii) compute the MSE for the weighted moving average in part (a) do you prefer this weighted moving average to unweighted moving average? Remember that the MSE for the unweighted moving average is 10.22
iii) Suppose you are allowed to choose any weight as long as they sum to 1. Could you always find a set of weights that would make the MSE smaller for the weighted moving average than for an unweighted moving average? Why or why not?
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