Which of the following statements about moving averages is not true? (a) It gives greater weight to more recent data (b) It is simpler than the method of exponential smoothing (c) It can be used to smooth a series (d) It gives equal weight to all values in the computation
Question
Which of the following statements about moving averages is not true? (a) It gives greater weight to more recent data (b) It is simpler than the method of exponential smoothing (c) It can be used to smooth a series (d) It gives equal weight to all values in the computation
Solution
The statement that is not true about moving averages is:
(a) It gives greater weight to more recent data
In a simple moving average model, all data points are given equal weight. Unlike the exponential smoothing method, it does not give more weight to recent data.
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