1. The following data is sales in millions of dollars for the Cassie Cat Company manufactures of grain free canned cat food.

Year.   1.   2.   3.  4.   5.   6.   7
Sales. 20. 22. 26. 24. 30. 28. 32

A. Use a three year moving average to generate a forecast for year 8 and determine its mean square error.
B. Use a smoothing constant 0f .8 to generate a forecast for year 8 and determine its mean square error.
C. Which method is the better?

2. The quarterly sales data (number of copies sold) for a college textbook 0ver the past three years follows.

Quarters.   year 1.    year 2.     year 3
1              1690.       1900.        1850
2.             890.         9100.        1200
3.             2625.       3000         2930
4.             2550.       2360.        2700

A. Show the four quarter and centered moving average for this time series.

B. Compute the seasonal and adjusted seasonal indexes for the four quarters.

C. Deseasonalize the time series.

D. Compute the linear trend equation for the deseasonalize data and forecast sales for the first quarter of year 4. Be sure to reseasonalize your forecast.