PLEASE REFER TO THE PICTURE FOR BETTER UNDERSTANDING. The following historical data have been collected representing sales of a product. Compare forecasts using a three$-$period moving average, exponential smoothing with an $a=0\mathrm{.}2,$ and linear

regression. Using MAD and MSE, which forecasting model is best? Are your results the same using the two error measures?

$($Round intermediate calculations to $3$ decimal places, e$.$g$.15\mathrm{.}251.$ Round your answers to $2$ decimal places,e$.$g$.15\mathrm{.}26.)$

Forecasts using a three$-$period moving average:

MAD criteria

MSE criteria

Forecasts using exponential smoothing with $a=0\mathrm{.}2$ :

MAD criteria

MSE criteria

Forecasts using linear regression:

MAD criteria

MSE criteria

The

model provides the best historical fit using the MAD criteria.

The

model provides the best historical fit using the MSE criteria.