When a forecaster uses the ______________ method she or he assumes that the time series components are changing slowly over time.
A)Time series regression
B)Exponential smoothing
C)Box and Jenkins
D)Multiplicative decomposition

Question

Quizplus · Accepted Answer

Exponential smoothing assumes that the time series components are changing slowly over time and that recent observations are more relevant than older observations. Time series regression involves fitting a linear equation to the data and assumes a linear relationship between the dependent variable and time. Box and Jenkins is a method for identifying and building autoregressive integrated moving average (ARIMA) models. Multiplicative decomposition is a method for decomposing a time series into trend, seasonal, and irregular components. While all of these methods may incorporate assumptions about how the time series components change over time, exponential smoothing is specifically designed to handle slowly changing time series components.

When a Forecaster Uses the ______________ Method She or He