The GATE Grind

GATE 2018 ME (ME1) – Question 26

Production Planning and Control · Forecasting models · 1 mark · Multiple choice

Which forecasting method equally weights each of the m most recent observations?

  1. Moving average
  2. Exponential smoothing with linear trend
  3. Triple exponential smoothing
  4. Kalman filter

Practise this question in The GATE Grind →

Show answer and explanation

Correct answer: (A) Moving average

Explanation

A simple m-period moving average is $\frac1m\sum_{j=1}^mX_j$, assigning every included observation weight 1/m and older observations zero weight. Answer A.