Consider the Following Time Series Data

question 32

Essay

Consider the following time series data:

Using the naïve method (most recent value) as the forecast for the next year, compute the following measures of forecast accuracy: a. Mean absolute error
b. Mean squared error
c. Mean absolute percentage error
d. What is the forecast for year 11?

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Definitions:

Annual Deficit

The shortfall in a government's income compared to its spending in a given fiscal year.

George Bush

Refers to either George H.W. Bush, the 41st President of the United States (1989-1993), or his son George W. Bush, the 43rd President of the United States (2001-2009), each having made lasting impacts on American and international politics.

Crowding-in

An economic phenomenon where increased government spending leads to higher private sector investment.

Crowding-out

A situation where increased public sector spending reduces the amount of available funds for private sector investments.