Use the Method of Moving Average with an Appropriate Span

question 36

Essay

Use the method of moving average with an appropriate span to forecast retail sales for 2010.Do you obtain a good fit? Do you have confidence in your forecast? Explain your answers.

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Definitions:

Interest Rate Collar

A derivative strategy that combines an interest rate cap and floor to limit exposure to interest rate fluctuations.

Lower Bound

A minimum value or limit that a variable, such as a stock price or interest rate, can assume.

Upper Bound

The maximum limit or highest achievable level of a particular measurement.

Call Option

A contractual arrangement providing the holder with the privilege, yet not the compulsion, to acquire an asset such as a stock, bond, or commodity, at a predetermined price during a defined period.