Below you are given some values of a time series consisting of 26 time periods. The estimated regression equation for these data is Y_t = 16.23 + .52Y_t-1 + .37Y_t-2
The forecasted value for time period 27 is

Question

Below you are given some values of a time series consisting of 26 time periods.

The estimated regression equation for these data is Y_t = 16.23 + .52Y_t-1 + .37Y_t-2
The forecasted value for time period 27 is

Quizplus · Accepted Answer

To find the forecast for time period 27, we use the estimated regression equation and substitute the values for t-1 and t-2 as zeros since we do not have any data beyond time period 26. Y_t = 16.23 + .52(0) + .37(0) Y_t = 16.23 Therefore, the forecasted value for time period 27 is 16.23 + .52(Y_t-1) + .37(Y_t-2) = 16.23 + .52(0) + .37(0) = 16.23 Therefore, the forecasted value for time period 27 is 16.23. Option D is the closest to this value.

Below You Are Given Some Values of a Time Series