Consider the Actual Values Y and Forecast Values F Given

question 31

Multiple Choice

Consider the actual values Y and forecast values F given in the table below. $$\begin{array} { | c | c | c | } \hline \text { Time Period } & \text { Y } & \text { F } \\\hline 1 & 19.5 & 19.3 \\\hline 2 & 21.5 & 20.9 \\\hline 3 & 22.6 & 22.5 \\\hline\end{array}$$ Calculate the mean absolute percentage error (MAPE) of the forecasts.

• A) 0.37
• B) 0.30
• C) 1.42
• D) 0.90

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Definitions:

Hedge

An investment strategy used to reduce the risk of adverse price movements in an asset.

Financial Risk

The possibility of losing money on an investment or business venture, including the risk of not achieving expected financial returns.

Mitigate

To make less severe, serious, or painful; often used in the context of reducing risk or harm.

Defined Benefit Plan

A type of pension plan where the employer promises a specified pension payment upon retirement, based on an employee's earnings history, tenure of service, and age.