Time Series Data and Forecasting

Question 1

what is time series data

Answer 1

numerical data in regular intervals

eg annually, quarterly, monthly, weekly, daily etc

Question 2

which axis is always the time period

Answer 2

x

Question 3

which axis is always the variable of interest

Answer 3

Y

Question 4

What is a trend

Answer 4

a gradual upward or downward movement (persistant)

Question 5

can trends be non linear

Answer 5

yes so long as they are overall moving in the same direction in total

Question 6

what are seasonal movements

Answer 6

short term waves often monthly or quaterly eg sale of school clothes

Question 7

what are cyclical movements

Answer 7

long term waves that regularly occur and vary in length eg house prices

Question 8

2 ways of smoothing data

Answer 8

moving averages, exponential smoothening

Question 9

what do the results of moving averages depend on

Answer 9

L (length of time)

Question 10

if there are bigger windows of time for L is there more or less errors

Answer 10

more

Question 11

why might you use moving average

Answer 11

easier to see underlying trends

Question 12

what does MAD stand for

Answer 12

Mean absolute difference

Question 13

are we looking for a high or low MAD

Answer 13

as low as possible

Question 14

what is exponential smoothing

Answer 14

weighted moving average

Question 15

what two numbers do weights lie between

Answer 15

1 and 0

Question 16

in exponential moving what is the first element

Answer 16

the result of the first one as there is no prior info

Question 17

how weighted average is calculated for each element after the first one

Answer 17

weightactual + (1-weight)actual of previous

Question 18

common pitfalls in time series analysis

Answer 18

assuming current trend will hold

not considering changing habits, technologies, business experience

Question 19

what is time series analysis

Answer 19

using data in the past to predict the future

Question 20

if using L=3 , how would you get moving average for the year 2002

Answer 20

average(2001-2003)

Question 21

what is the moving average prediction for the year 2002

Answer 21

2001 smoothened version