Question
In: Finance
Using the stock prices in Problem 3, calculate the exponential three-month moving average for both stocks...
Using the stock prices in Problem 3, calculate the exponential three-month moving average for both stocks where two-thirds of the average weight is placed on the most recent price.
| Amazon | |
| $169.64 | $600.36 |
| $173.29 | $613.40 |
| $180.13 | $586.76 |
| $195.81 | $544.10 |
| $196.69 | $529.02 |
| $204.49 | $506.38 |
| $222.52 | $603.69 |
| $215.23 | $540.96 |
| $216.23 | $515.04 |
| $213.51 | $592.64 |
| $192.29 | $599.39 |
| $173.10 | $645.90 |
Solutions
Expert Solution
The 1st step is to compute the simple three month moving average. Simple 3 month moving average = sum of last 3 months price/3
| Amazon | 3 month moving total | 3 month moving average | 3 month moving total | 3 month moving average | ||
| 169.94 | 600.36 | |||||
| 173.29 | 613.40 | |||||
| 180.13 | 586.76 | |||||
| 195.81 | 523.36 | 174.45 | 544.10 | 1,800.52 | 600.17 | |
| 196.69 | 549.23 | 183.08 | 529.02 | 1,744.26 | 581.42 | |
| 204.49 | 572.63 | 190.88 | 506.38 | 1,659.88 | 553.29 | |
| 222.52 | 596.99 | 199.00 | 603.69 | 1,579.50 | 526.50 | |
| 215.23 | 623.70 | 207.90 | 540.96 | 1,639.09 | 546.36 | |
| 216.23 | 642.24 | 214.08 | 515.04 | 1,651.03 | 550.34 | |
| 213.51 | 653.98 | 217.99 | 592.64 | 1,659.69 | 553.23 | |
| 192.29 | 644.97 | 214.99 | 599.39 | 1,648.64 | 549.55 | |
| 173.10 | 622.03 | 207.34 | 645.90 | 1,707.07 | 569.02 | |
| 578.90 | 192.97 | 1,837.93 | 612.64 |
Now alpha = 2/3 (or 0.667). Now we can find exponential three-month moving average. It is = (alpha * actual observation in the t-1th period) + [(1-alpha)*simple moving average in the t-1th period]
For example for Amazon for the 3rd period exponential three-month moving average = 2/3*180.13 + [(1-2/3)*(174.45)] = 178.24
| Amazon | 3 month moving total | 3 month moving average | Exponential moving avg. | 3 month moving total | 3 month moving average | Exponential moving avg. | ||
| 169.94 | 600.36 | |||||||
| 173.29 | 613.40 | |||||||
| 180.13 | 586.76 | |||||||
| 195.81 | 523.36 | 174.45 | 178.24 | 544.10 | 1,800.52 | 600.17 | 591.23 | |
| 196.69 | 549.23 | 183.08 | 191.57 | 529.02 | 1,744.26 | 581.42 | 556.54 | |
| 204.49 | 572.63 | 190.88 | 194.75 | 506.38 | 1,659.88 | 553.29 | 537.11 | |
| 222.52 | 596.99 | 199.00 | 202.66 | 603.69 | 1,579.50 | 526.50 | 513.09 | |
| 215.23 | 623.70 | 207.90 | 217.65 | 540.96 | 1,639.09 | 546.36 | 584.58 | |
| 216.23 | 642.24 | 214.08 | 214.85 | 515.04 | 1,651.03 | 550.34 | 544.09 | |
| 213.51 | 653.98 | 217.99 | 216.82 | 592.64 | 1,659.69 | 553.23 | 527.77 | |
| 192.29 | 644.97 | 214.99 | 214.00 | 599.39 | 1,648.64 | 549.55 | 578.28 | |
| 173.10 | 622.03 | 207.34 | 197.31 | 645.90 | 1,707.07 | 569.02 | 589.27 | |
| 578.90 | 192.97 | 179.72 | 1,837.93 | 612.64 | 634.81 |
jeff jeffy answered 3 days agoRelated Solutions
a. Show the naive forecast, an exponential smoothing forecasts using α = 0.2, and a 3-month moving average forecast.
Month137244335450534630750829936103511411245a. Show the naive forecast, an exponential smoothing
forecasts using α = 0.2, and a 3-month moving average forecast.b. Compare the MFE, MSE, and MAPE on the modelsc. Make a conclusion on which model to use.d. Find the alpha (smoothing constant) that minimizes the
MSE.
Of the three quantitative forecasting techniques (moving average, weighted moving average, and exponential smoothing), which do...
Of the three quantitative forecasting techniques (moving
average, weighted moving average, and exponential smoothing), which
do you think provides the most accurate forecast and why?
Problem 8-4 Exponential Moving Averages (LO4, CFA1) The table below shows the closing monthly stock prices...
Problem 8-4 Exponential Moving Averages (LO4, CFA1)
The table below shows the closing monthly stock prices for IBM
and Amazon. Calculate the exponential three-month moving average
for both stocks where two-thirds of the average weight is placed on
the most recent price. (Do not round intermediate
calculations. Round your answers to 2 decimal places.)
IBM
AMZN
January
$
181.04
$
627.91
February
180.89
633.92
March
204.07
559.97
April
221.08
551.70
May
187.57
489.50
June
213.23
483.58
July
247.79
609.39
August...
Problem 8-4 Exponential Moving Averages (LO4, CFA1) The table below shows the closing monthly stock prices...
Problem 8-4 Exponential Moving Averages (LO4, CFA1) The table
below shows the closing monthly stock prices for IBM and Amazon.
Calculate the exponential three-month moving average for both
stocks where two-thirds of the average weight is placed on the most
recent price. (Do not round intermediate calculations. Round your
answers to 2 decimal places.) IBM AMZN January $ 175.64 $ 614.86
February 177.29 624.20 March 192.73 572.66 April 209.11 548.10 May
191.89 508.22 June 209.09 494.38 July 235.82 606.69 August...
DeLoan Corporation uses a six-month moving average to calculate material scrap rate. Both the auditor and...
DeLoan Corporation uses a six-month moving average to calculate
material scrap rate. Both the auditor and technical analyst concur
with the use of this procedure. Both have also validated the
available data.
Month January February March April May June July
Scrap $6,000 $5,500 $4,200 $6,500 $5,800 $5,300 $5,700
Material Req $100,000 $100,000 $69,000 $105,000 $89,000 $88,000
$99,000
1. What would you estimate the scrap rate to be using a 6-month
moving average? 2. Using that scrap rate, what would be...
For the attached data set, 1. create a 3-month and 6-month moving average forecast. 2. Calculate...
For the attached data set,
1. create a 3-month and 6-month moving average forecast.
2. Calculate the standard errors
3. compare their forecast accuracy
Month/Year
Unemployment rate
Jan-17
5.1
Feb-17
4.9
Mar-17
4.6
Apr-17
4.1
May-17
4.1
Jun-17
4.5
Jul-17
4.6
Aug-17
4.5
Sep-17
4.1
Oct-17
3.9
Nov-17
3.9
Dec-17
3.9
Jan-18
4.5
Feb-18
4.4
Mar-18
4.1
Apr-18
3.7
May-18
3.6
Jun-18
4.2
Jul-18
4.1
Aug-18
3.9
Sep-18
3.6
Oct-18
3.5
Nov-18
3.5
Please run Moving Average with 2 and 3 periods; Exponential Smoothing with a smoothing factor, or...
Please run Moving
Average with 2 and 3 periods; Exponential Smoothing with a
smoothing factor, or alpha, of 0.1 , 0.5 and 0.9; and Classical
Decomposition for the data listed below.
Which model is best?
Please explain how you were able to run each model using Microsoft
Excel.
Year
Quarter
Sales
Advertising
1
1
144
41
2
151
51
3
134
32
4
151
45
2
1
145
48
2
145
34
3
141
29
4
166
43
3
1...
Please run Moving Average with 2 and 3 periods; Exponential Smoothing with a smoothing factor, or...
Please run Moving
Average with 2 and 3 periods; Exponential Smoothing with a
smoothing factor, or alpha, of 0.1 , 0.5 and 0.9; and Classical
Decomposition for the data listed below.
Which model is best?
Please explain how you were able to run each model using Microsoft
Excel.
Year
Quarter
Sales
Advertising
1
1
144
41
2
151
51
3
134
32
4
151
45
2
1
145
48
2
145
34
3
141
29
4
166
43
3
1...
The table below shows the closing monthly stock prices for IBM and Amazon. Calculate the exponential...
The table below shows the closing monthly stock prices for IBM
and Amazon. Calculate the exponential three-month moving average
for both stocks where two-thirds of the average weight is placed on
the most recent price. (Do not round intermediate
calculations. Round your answers to 2 decimal places.)
IBM
AMZN
January
$
177.44
$
619.21
February
178.49
627.44
March
196.51
568.43
April
213.10
549.30
May
190.45
501.98
June
210.47
490.78
July
239.81
607.59
August
199.24
535.11
September
222.47
511.66
October
215.07...
The table below shows the closing monthly stock prices for IBM and Amazon. Calculate the exponential...
The table below shows the closing monthly stock prices for IBM
and Amazon. Calculate the exponential three-month moving average
for both stocks where two-thirds of the average weight is placed on
the most recent price. (Do not round intermediate
calculations. Round your answers to 2 decimal places.)
IBM
AMZN
January
$
172.64
$
607.61
February
175.29
618.80
March
186.43
579.71
April
202.46
546.10
May
194.29
518.62
June
206.79
500.38
July
229.17
605.19
August
209.08
538.71
September
218.63
513.74
October
214.11...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Strong Metals Inc. purchased a new stamping machine at the beginning of the year at a...
- 2. Will the following statements cause any error? (Yes/No) If a statement causes an error, what...
- Part I– Check your file system Step 1: Execute the ls /dev/sd* command to see the...
- import java.util.Scanner; import java.util.Arrays; /* You have 3 small methods to write for this exam; public...
- [The following information applies to the questions displayed below.] At the beginning of the year, Plummer's...
- In sql: Write a query to produce a listing of unique vendor names who have at...
- A compound of molecular formula C7H13Br is a tertiary bromide, is optically inactive, and has one...
ADVERTISEMENT