The Monthly Sales Revenue (In Hundreds of Dollars) of a Company

question 33

Essay

The monthly sales revenue (in hundreds of dollars) of a company for one year is listed below.
a. Compute MSE using the most recent value as the forecast for the next period. What is the forecast for the next month?
b. Compute MSE using the average of all the data available as the forecast for the next period. What is the forecast for the next month?
c. Which method appears to provide the better forecast?

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Definitions:

Zimmermann Telegram

A secret diplomatic communication sent by Germany in 1917 proposing a military alliance with Mexico if the U.S. entered World War I against Germany, influencing the U.S. decision to declare war.

Military Aid

Support provided by one country to another in the form of defense equipment, training, or other resources intended for military purposes.

Germany

A country in Central Europe, known for its history, culture, and economic prowess, as well as for playing a major role in both World Wars and the Cold War.

Pacifist Sentiment

The belief in or inclination towards avoiding war or violence as means of settling disputes, favoring peaceful resolutions and negotiations.