The euro is the second-most traded currency (after the U.S. dollar), so its value relative to other currencies is of great interest. One euro was equal to one U.S. dollar when the new European currency was launched on January 1, 1999. Since that time the value has f luctuated. On October 26, 2000, one euro cost \($0.8252.\) But on July 15, 2008, it was as high as \($1.5990.\) As the time series plot of 50 weekly euro/dollar values between July 1, 2012, and June 9, 2013, shows, recent f luctuations show little pattern, so smoothing methods may be the best approach to short-term prediction of euro values.

Here are some of those euro values in dollars for the weeks of July and August 2012:

QUESTION: 

Find a three-term moving average for these data and predict the value for the next week.

Transcribed Image Text:

Euro/Dollar 1.32 1.28 1.24 Aug 26 Jan 13, 2013 Time Jun 2