Compute the forecast error for the given problem.
In order to estimate the attendance at an annual tennis tournament a model has been developed which uses attendance from the previous year as well as the amount spent for advertising this year. From the years exposed in the table, forecast the attendance for years 25 also find out the forecast error.
Year

Attendance

Advertising Expenditure

Forecast

Error

1

8363

750



2

9426

1250



3

9318

3200



4

10206

4500



5

11018

5600



The multiple regression model is Attendance = 6738 + .23($) + .25 (Attlag)
Note 'Attlag' means lastyear's actual attendance. Therefore in forecasting the second year's attendance we'd use the first year's actual attendance value and so forth.