Question
How do I use the data provided to create a performance evaluation bias and graphic evaluation? Using the 3 techniques to forecast the future of
How do I use the data provided to create a performance evaluation bias and graphic evaluation?
Using the 3 techniques to forecast the future of the baht Fundamental forecasting Market-based forecasting Technical forecasting including the performance evaluation bias and its graphic evaluation.
Beginning baht is .023
Value of
-6.85 depreciation
Fundamental forecast for 90 days
$.023 x (1-.0685) = $.0214
Absolute forecast errors percentage if the baht was .022 at the end of 90 days
Technical ($.02162 - $.022)/$.022 = 1.73%
Fundamental ($.0214 - $.022)/$.022 = 2.73%
Market-based ($.021 - $.022)/.022 = 4.54%
Here is the data we were presented with in creating these forecasts:
The technical forecast indicates a depreciation of the baht by 6 percent over the next quarter from the baht’s current level of $.023 to $.02162. He has also conducted a fundamental forecast of the baht-dollar exchange rate using historical inflation and interest rate data. The fundamental forecast, however, depends on what happens to Thai interest rates during the next quarter and therefore reflects a probability distribution. Based on the inflation and interest rates, there is a 30 percent chance that the baht will depreciate by 2 percent, a 15 percent chance that the baht will depreciate by 5 percent, and a 55 percent chance that the baht will depreciate by 10 percent.
Step by Step Solution
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Step: 1
Performance Evaluation Bias Performance evaluation bias is a form of cognitive bias in which an individual evaluates the performance of a person or system based on preconceived notions or expectations ...Get Instant Access to Expert-Tailored Solutions
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