Suppose you decide to forecast a data series four periods ahead (forecast horizon equals four). In conducting a within sample forecast assessment you compare the forecast using simple trend (FCAST1) and quadratic trend (FCAST2). Using the actual values of the series (ACTUAL) and the forecast information below, calculate the root mean squared error for each forecasting model and comment on which one should be used. ACTUAL FCAST1 FCAST2 10 10 8. 10 20 13 20 30 26 40 40 47
Suppose you decide to forecast a data series four periods ahead (forecast horizon equals four). In conducting a within sample forecast assessment you compare the forecast using simple trend (FCAST1) and quadratic trend (FCAST2). Using the actual values of the series (ACTUAL) and the forecast information below, calculate the root mean squared error for each forecasting model and comment on which one should be used. ACTUAL FCAST1 FCAST2 10 10 8. 10 20 13 20 30 26 40 40 47
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Author:Amos Gilat
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
Transcribed Image Text:Suppose you decide to forecast a data series four periods ahead (forecast horizon
equals four). In conducting a within sample forecast assessment you compare the
forecast using simple trend (FCAST1) and quadratic trend (FCAST2). Using the actual
values of the series (ACTUAL) and the forecast information below, calculate the root
mean squared error for each forecasting model and comment on which one should
be used.
ACTUAL
FCAST1
FCAST2
10
10
8.
10
20
13
20
30
26
40
40
47
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