A Six-Month Moving Average Forecast Is Generally Better Than a Three-Month

question 50

Multiple Choice

A six-month moving average forecast is generally better than a three-month moving average forecast if demand:

• A) is rather stable.
• B) has been changing due to recent promotional efforts.
• C) follows a downward trend.
• D) exceeds one million units per year.
• E) follows an upward trend.

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Definitions:

Market's Volatility

The degree of variation of a trading price series over time, often measured by the standard deviation of returns.

Value Line Index

An index which represents the performance of stocks in the market, aiming to include a broad spectrum of companies across different industries.

Geometric Average

The nth root of the product of n numbers. It is used to measure the compound rate of return over a given sample period.

Equally-Weighted

An investment strategy where each asset in a portfolio is given the same weight or importance.