Consider the Following Annual Series on the Number of People

question 39

Essay

Consider the following annual series on the number of people assisted by a county human resources department.

a.Prepare 3-year moving average values to be used as forecasts for periods 4 through 11. Calculate the mean squared error (MSE) measure of forecast accuracy for periods 4 through 11.
b.
b.Use a smoothing constant of .4 to compute exponential smoothing values to be used as forecasts for periods 2 through 11. Calculate the MSE.
c.Compare the results in Parts a and b.

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Definitions:

Operating Income

Income generated from a company's regular business operations, excluding one-time events and expenses.

Variable Cost

Costs that change in proportion to the level of activity or volume of goods produced.

Fixed Costs

Costs that do not change with the volume of production, such as rent, salaries, or insurance.

Contribution Margin

The difference between sales revenue and variable costs of a product or service, used to cover fixed costs and to generate profit.