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The following table gives the actual change in the log of sales of Cisco Systems from 1Q:2001 to 4Q:2001, along with the forecasts from the
The following table gives the actual change in the log of sales of Cisco Systems from 1Q:2001 to 4Q:2001, along with the forecasts from the regression model ln( Sales t)=0.0661+0.4698ln( Sales t1) estimated using data from 3Q:1991 to 4Q:2000. (Note that the observations after the fourth quarter of 2000 are out of sample.) A. Calculate the RMSE for the out-of-sample forecast errors. B. Compare the forecasting performance of the model given with that of another model having an out-of-sample RMSE of 20 percent
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