Explore BrainMass
Share

Explore BrainMass

    Forecast Analysis: Food Price Index

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    The following table shows six years of average annual food price index (May to April data):

    Year Annual Food Price Index
    2005 101.8
    2006 114.8
    2007 143.3
    2008 144.3
    2009 138.1
    2010 165.1

    (a) Forecast the average annual food price index for all years from 2008 to 2011. Use a three-year weighted moving average with weights of 0.5, 0.3, and 0.2. Use the largest weight with the most recent data.
    (b) Forecast the average annual food price index using exponential smoothing with α = 0.7 for all years from 2006 to 2011. Use the rate for 2005 as the starting forecast for 2005.
    (c) Which of the methods in parts (a) and (b) produces better forecasts for the three years from 2008 to 2010? Answer on the basis of mean square error ('MAD).

    © BrainMass Inc. brainmass.com October 10, 2019, 7:52 am ad1c9bdddf
    https://brainmass.com/math/interpolation-extrapolation-and-regression/forecast-analysis-food-price-index-598420

    Solution Summary

    The solution contains detailed step by step calculations pertaining to the given problem.

    $2.19