Wayne Rexburg Is Asked Which of the Models - Moving

question 82

Multiple Choice

Wayne Rexburg is asked which of the models - moving average models,exponential smoothing models,and regression analyses - is most accurate? Wayne should reply:

• A)Regression analyses because it uses the most sophisticated mathematical techniques to yield a sales forecast.
• B)Exponential smoothing models because the forecaster can determine the degree to which a particular period can affect forecasted sales.
• C)Moving average models because they give each period equal weight and are easy to compute.
• D)Depending on the data and the objectives of the forecaster,any one of the techniques may provide the most accurate sales forecasts.

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Definitions:

Average Stock

Average Stock is a metric used to estimate the average amount of inventory a company holds over a certain period of time.

Market Risk Premium

The additional return an investor requires from a market portfolio over the risk-free rate as compensation for bearing higher risk.

Risk-free Rate

The theoretical return on an investment with zero risk, typically represented by the yield on government securities.

Individual Security

A specific financial instrument, such as a stock or bond, that represents ownership in a company or governmental debt obligation.