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Average method to forecast sales price

HP uses X63 chip in their computers and prices for these chips for last 12 months are:

Month |
Jan |
Feb |
Mar |
Apr |
May |
Jun |
July |
Aug |
Sep |
Oct |
Nov |
Dec |

Price ($) |
1.80 |
1.67 |
1.70 |
1.85 |
1.90 |
1.87 |
1.80 |
1.83 |
1.70 |
1.65 |
1.70 |
1.75 |

Forecast next month (i.e. next Jan) sales price using each of the following:

- First use 2-month and then 3-month moving average method to forecast sales price. Using MAD approach, which average is better?
- If the initial Jan forecasts were also $1.80; in an exponential smoothing method, first use a = 0.1 and then a = 0.5; Using MSE approach, which value of a is better to predict sales price?
- In practice, both MAD and MSE can be used to find forecast accuracy giving the same decisions. Why would you choose one over the other? ( Can you explain how to do it by solving, not excel)

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