Business Statistics

584 Business Statistics

y = 130 + 7 × (x)

For the year 2005 (which is 12 years away from the origin year 1993) the pro-

jected production can be computed as:

y = 130 + 7 × (12) = 214

Figure 16.14 exhibits the time series plot of production (trend line obtained by the

method of semi-averages).

FigUre 16.14

Time series plot of production

(trend line obtained by the

method of semi-averages) for

Example 16.2

16.11 EXPONENTIAL SMOOTHING METHOD

Exponential smoothing is another technique used to “smooth” a time series. Exponential smoothing

is a type of moving average technique which consists of a series of exponentially weighted moving

averages.