Assignment:
Naive Forecasting
Complete the table, then determine the MAD and MSE. What is your forecast for Week 13?
(Some of the values have been filled in for you to help with your calculations.)
McCray Enterprise: Weekly closing price per share
Week Price Forecast Residuals ABS SQUARED
t yt Ft yt - Ft lyt - Ft l (yt - Ft )2
1 80.00 No Forecast
2 80.50 80.00 0.5 0.5 0.25
3 81.00
4 80.25 81.00 -.75 0.75 .5625
5 81.50
6 82.00
7 80.50 82.00 -1.5 1.5 2.25
8 81.00
9 82.50
10 83.00
11 80.50
12 81.00
S lyt - Ft l S (yt - Ft )2
1.) Mean Absolute Deviation = S lyt- Ftl
11
2) Mean Squared Error = S (yt - Ft)2
11
3) Forecast for Week 13 =