Which of the following methods is appropriate for forecasting a time series when the trend,cyclical,and seasonal components of the series are not significant?
A)Moving averages
B)Exponential smoothing
C)Mean absolute deviation
D)Seasonal indexes

Question

Quizplus · Accepted Answer

When the trend, cyclical, and seasonal components of a time series are not significant, the series is said to be stationary. In such cases, moving averages can be an appropriate method for forecasting as they make use of the average of past observations to forecast future values. Exponential smoothing and seasonal indexes are not necessary when there is no trend or seasonality in the data, and mean absolute deviation is a measure of forecast accuracy, not a forecasting method.

Which of the Following Methods Is Appropriate for Forecasting a Time