Which of the following is/are true regarding moving averages?
A) Crucial to the success of the forecast is determining the ideal number of periods to include in the average.
B) Large numbers of periods make the forecast react quickly to changes in a series.
C) All periods are weighted equally, and this speeds up reaction to changes in a series.
D) Two of the above, and they are b and
E) All of the above.

Question

Quizplus · Accepted Answer

A is the only option that correctly identifies the importance of determining the ideal number of periods to include in the average for the success of the forecast. B is incorrect because large numbers of periods lead to a slower reaction to changes in a series, not a quicker one. C is incorrect because some types of moving averages, such as weighted moving averages, do not weight all periods equally.

Which of the Following Is/are True Regarding Moving Averages