Corporate triple-A bond interest rates for 12 consecutive months follow. 9.5 9.4 9.5 9.6 9.8 9.8 9.9 10.6 9.9 9.7 9.6 9.6 (a) Construct a time series plot. What type of pattern exists in the data? The data appear to follow a trend pattern.The data appear to follow a cyclical pattern. The data appear to follow a horizontal pattern.The data appear to follow a seasonal pattern. (b) Develop three-month and four-month moving averages for this time series. (Round your answers to two decimal places.) Month Time Series Value 3-Month Moving Average Forecast 4-Month Moving Average Forecast 1 9.5 2 9.4 3 9.5 4 9.6 5 9.8 6 9.8 7 9.9 8 10.6 9 9.9 10 9.7 11 9.6 12 9.6 Does the three-month or four-month moving average provide more accurate forecasts based on MSE? Explain. The three-month moving average provides more accurate forecasts, because its MSE is larger than that of the four-month moving average.The four-month moving average provides more accurate forecasts, because its MSE is smaller than that of the three-month moving average. The four-month moving average provides more accurate forecasts, because its MSE is larger than that of the three-month moving average.The three-month moving average provides more accurate forecasts, because its MSE is smaller than that of the four-month moving average. (c) Using the more accurate forecast, what is the moving average forecast for the next month? (Round your answer to two decimal places.)

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter13: Regression And Forecasting Models

Section13.7: Exponential Smoothing Models

Problem 29P: The file P13_29.xlsx contains monthly time series data for total U.S. retail sales of building...

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Corporate triple-A bond interest rates for 12 consecutive months follow.

9.5

9.4

9.5

9.6

9.8

9.9

10.6

9.9

9.7

9.6

(a)

Construct a time series plot.

What type of pattern exists in the data?

The data appear to follow a trend pattern.The data appear to follow a cyclical pattern. The data appear to follow a horizontal pattern.The data appear to follow a seasonal pattern.

(b)

Develop three-month and four-month moving averages for this time series. (Round your answers to two decimal places.)

Month	Time Series Value	3-Month Moving Average Forecast	4-Month Moving Average Forecast
1	9.5
2	9.4
3	9.5
4	9.6
5	9.8
6	9.8
7	9.9
8	10.6
9	9.9
10	9.7
11	9.6
12	9.6

Does the three-month or four-month moving average provide more accurate forecasts based on MSE? Explain.

The three-month moving average provides more accurate forecasts, because its MSE is larger than that of the four-month moving average.The four-month moving average provides more accurate forecasts, because its MSE is smaller than that of the three-month moving average. The four-month moving average provides more accurate forecasts, because its MSE is larger than that of the three-month moving average.The three-month moving average provides more accurate forecasts, because its MSE is smaller than that of the four-month moving average.

(c)

Using the more accurate forecast, what is the moving average forecast for the next month? (Round your answer to two decimal places.)

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