The Following Data Represents the Home Mortgage Loan Interest Rates

question 73

Essay

The following data represents the home mortgage loan interest rates at a local bank over an eight-month period:
$\begin{array}{|c|c|c|c|}\hline \text { Month } & \text { Rate (\%) } & \text { Month } & \text { Rate (\%) } \\\hline 1 & 8.7 & 5 & 8.6 \\\hline 2 & 8.7 & 6 & 8.4 \\\hline 3 & 8.6 & 7 & 8.8 \\\hline 4 & 8.6 & 8 & 8.8 \\\hline\end{array}$
a.What is the forecast for month 8 using a moving average model with k = 4?
b.What is the forecast for month 9 using a moving average model with k = 6?

---

Definitions:

Aggregate Demand

The total demand for all goods and services within a particular market or economy at a given overall price level and in a given period.

Real Exchange Rate

Measures the value of goods in one country compared to those in another, adjusting for price level differences.

Net Exports

The value calculated by subtracting a country's total value of imports from its total value of exports, which reflects a country's external trade balance.

Foreign-Currency Exchange

The process of exchanging one currency for another, determining how much one currency is worth in terms of another.