Your SlideShare is downloading. ×
Moving Average Method
Upcoming SlideShare
Loading in...5
×

Thanks for flagging this SlideShare!

Oops! An error has occurred.

×
Saving this for later? Get the SlideShare app to save on your phone or tablet. Read anywhere, anytime – even offline.
Text the download link to your phone
Standard text messaging rates apply

Moving Average Method

48,185

Published on

Published in: Business
2 Comments
4 Likes
Statistics
Notes
  • test
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • Hi there, Really struggling with working out the centered moving average trend. Ive been at this 5 full days trying to get the same answer as in an example i have found but know luck. I've been asked to work the moving average and then the centered moving average out, then the centered moving average trend, then Cyclic Factor which i understand to be the ratio between the CMA and the CMAtrend. Then working out the Seasonal Factor and the seasonal Index.I've been able to work out how to do the SF but also unsure on the index, if you are able to help at all i would be extremely greatful!
    Many Thanks
    Natalie
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
No Downloads
Views
Total Views
48,185
On Slideshare
0
From Embeds
0
Number of Embeds
0
Actions
Shares
0
Downloads
508
Comments
2
Likes
4
Embeds 0
No embeds

Report content
Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
No notes for slide

Transcript

  • 1. Moving Average Method Time Series Secular Trend 3.Moving Average Method 4. Method Of Least Squares
  • 2. Moving Averages
    • Used for Smoothing
    • Series of Arithmetic Means Over Time
    • Result Dependent Upon Choice of L (Length of Period for Computing Means)
    • To Smooth Out Cyclical Component, L Should Be Multiple of the Estimated Average Length of the Cycle
    • For Annual Time Series, L Should Be Odd
  • 3. Moving Averages
    • Example: 3-Year Moving Average
      • First average:
      • Second average:
    (continued)
  • 4. Moving Average Example Year Units Moving Ave 1994 2 NA 1995 5 3 1996 2 3 1997 2 3.67 1998 7 5 1999 6 NA John is a building contractor with a record of a total of 24 single family homes constructed over a 6-year period. Provide John with a 3-year moving average graph.
  • 5. Moving Average Example Solution Year Response Moving Ave 1994 2 NA 1995 5 3 1996 2 3 1997 2 3.67 1998 7 5 1999 6 NA 94 95 96 97 98 99 8 6 4 2 0 Sales L = 3 No MA for the first and last ( L -1)/2 years
  • 6. Exponential Smoothing
    • Weighted Moving Average
      • Weights decline exponentially
      • Most recent observation weighted most
    • Used for Smoothing and Short-Term Forecasting
  • 7. Exponential Weight: Example Year Response Smoothing Value Forecast (W = .2, (1-W)=.8) 1994 2 2 NA 1995 5 (.2)(5) + (.8)(2) = 2.6 2 1996 2 (.2)(2) + (.8)(2.6) = 2.48 2.6 1997 2 (.2)(2) + (.8)(2.48) = 2.384 2.48 1998 7 (.2)(7) + (.8)(2.384) = 3.307 2.384 1999 6 (.2)(6) + (.8)(3.307) = 3.846 3.307
  • 8. Question No 1
    • Calculate the five yearly moving averages of a no of students studying in a commerce college as shown in by the following figures
  • 9. Home work 1
    • Work out the trend values by centered 4 yearly moving average method for the following data and plot the given values and trend values on a graph
  • 10. Question no 3
    • For the following Series of observation verify that 4 year centered moving averages is equivalent to a 5 year weighted moving average with weights 1,2,2,2,1
    • ting

×