Two Forecasting Models Were Used to Predict the Future Values

question 36

Short Answer

Two forecasting models were used to predict the future values of a time series. The forecasts are shown below with the actual values.
Calculate the mean squared deviation (MSD) for Model 2.

---

Definitions:

Perfectly Competitive Market

A market structure characterized by many buyers and sellers, identical products, and no barriers to entry or exit, leading to efficient price determination.

Short Run

A period in which at least one factor of production is fixed and cannot be changed.

Purely Competitive Industry

A market structure characterized by many small firms producing identical products, with no single firm able to influence market prices.