The U.S. monthly inflation rate for 2018 is shown below: MONTH January INFLATION (%) MONTH INFLATION...
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The U.S. monthly inflation rate for 2018 is shown below: MONTH January INFLATION (%) MONTH INFLATION (%) 2.1 July 3.0 February 2.2 August 2.7 March 2.4 September 2.3 April 2.5 October 2.5 May June 2.8 2.9 November December 2.2 1.9 a. Compute the inflation rate for January 2019 using the exponential smoothing forecast using a = 0.3 and then using 0.9. Assume that the forecast for January 2018 is 2.1. Do not round intermediate calculations. Round your answers to three decimal places. % Forecast (January 2019, a = 0.3): Forecast (January 2019, a = 0.9): % b. What is the MAD for the forecasts generated using exponential smoothing method? Use only the months from March to December. Do not round intermediate calculations. Round your answers to three decimal places. MAD (a = 0.3): p.p. MAD (a = 0.9): p.p. Which method is better? The exponential smoothing with a smoothing constant of 0.9 is better because it provides a lower MAD. The U.S. monthly inflation rate for 2018 is shown below: MONTH January INFLATION (%) MONTH INFLATION (%) 2.1 July 3.0 February 2.2 August 2.7 March 2.4 September 2.3 April 2.5 October 2.5 May June 2.8 2.9 November December 2.2 1.9 a. Compute the inflation rate for January 2019 using the exponential smoothing forecast using a = 0.3 and then using 0.9. Assume that the forecast for January 2018 is 2.1. Do not round intermediate calculations. Round your answers to three decimal places. % Forecast (January 2019, a = 0.3): Forecast (January 2019, a = 0.9): % b. What is the MAD for the forecasts generated using exponential smoothing method? Use only the months from March to December. Do not round intermediate calculations. Round your answers to three decimal places. MAD (a = 0.3): p.p. MAD (a = 0.9): p.p. Which method is better? The exponential smoothing with a smoothing constant of 0.9 is better because it provides a lower MAD.
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