“The average college senior graduated this year with more than $19,000 in debt” was the beginning sentence of a recent article in USA Today. The majority of students have loans that are not due until the student leaves school. This can result in the student ignoring the size of debt that piles up. Federal loans obtained to finance college education are steadily mounting. The data given here show the amount of loans ($million) for the last 20 academic years, with year 20 being the most recent.

a. Produce a time-series plot for these data. Specify the exponential forecasting model that should be used to obtain next year’s forecast.
b. Assuming a double exponential smoothing model, fit the least squares trend to the historical data to determine the smoothed constant-process value and the smoothed trend value for period 0.
c. Using data for periods 1 through 20 and using α = 0.20 and β = 0.30, forecast the total student loan volume for the year 21.
d. Calculate the MAD for this model.