Daily Spot Exchange Rate, U.S. Dollars per Pound Sterling

Date Rate Date Rate Date Rate

1-Apr-04 1.8564 13-Apr-04 1.8160 23-Apr-04 1.7674

2-Apr-04 1.8293 14-Apr-04 1.7902 26-Apr-04 1.7857

5-Apr-04 1.8140 15-Apr-04 1.7785 27-Apr-04 1.7925

6-Apr-04 1.8374 16-Apr-04 1.8004 28-Apr-04 1.7720

7-Apr-04 1.8410 19-Apr-04 1.8055 29-Apr-04 1.7751

8-Apr-04 1.8325 20-Apr-04 1.7914 30-Apr-04 1.7744

9-Apr-04 1.8322 21-Apr-04 1.7720 3-May-04 1.7720

12-Apr-04 1.8358 22-Apr-04 1.7684 4-May-04 1.7907

5-May-04 1.7932 13-May-04 1.7584 21-May-04 1.7880

6-May-04 1.7941 14-May-04 1.7572 24-May-04 1.7908

7-May-04 1.7842 17-May-04 1.7695 25-May-04 1.8135

10-May-04 1.7723 18-May-04 1.7695 26-May-04 1.8142

11-May-04 1.7544 19-May-04 1.7827 27-May-04 1.8369

12-May-04 1.7743 20-May-04 1.7710 28-May-04 1.8330

Click here for the Excel Data File

(a) Make a line chart and fit an m-period moving average to the exchange rate data shown above with m = 2, 3, 4, and 5 periods. For each method, state the last MA value. (Round your answers to 4 decimal places.)

m-period Next period forecast

2 1.8256 1.8256 Incorrect

3 1.8280 1.8280 Correct

4 1.8139 1.8139 Incorrect

5 1.8177 1.8177 Correct