Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Here are earnings per share for two companies by quarter from the first quarter of three years ago through the second quarter of this
Here are earnings per share for two companies by quarter from the first quarter of three years ago through the second quarter of this year. Forecast earnings per share for the rest of this year and next year. Use exponential smoothing to forecast the third period of this year, and the time series decomposition method to forecast the last two quarters of this year and all four quarters of next year. (It is much easier to solve this problem on a computer spreadsheet so you can see what is happening.) EARNINGS PER SHARE COMPANY A COMPANY B 3 years ago QUARTER I $1.76 $ 0.23 2.32 0.27 III 1.25 0.29 IV 1.21 0.26 2 years ago I 1.41 0.28 11 1.98 0,37 1.28 0.36 IV 0.39 0.37 last year I 0.24 0.25 11 -0.19 (loss) 0.36 -0.94 (loss) 0.51 IV 0.25 0.50 this year -1.73 (loss) -0.36 0.35 0.50 a. For the exponential smoothing method, choose the first quarter of 3 years ago as the beginning forecast. Make two forecasts one with a = 0.20 and one with a = 0.40 (Negative values should be indicated by a minus sign. Round your answers to 3 decimal places.) Company A Company B Quarter Forecast a=0.20 Forecast Forecast Forecast a=0:40 a=0.20 a=0.40 Type here to search O 49% 11:33 AM 2/3/2021
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started