Moving average method

1) calculate 3 yearly
moving average

QUESTION- Year Production

2000 12
2001 14
2002 18
2003 24
2004 22
2005 20
2006 16
2007 25
2008 26
2009 34
2010 31

Chart Title
100
90
80
70
60
50
40
30
20
10
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Production 3 yearly moving sum 3 yearly moving sum

3 yearly 3 yearly
ANSWER- Year Production
moving sum moving sum
2000 12 - -
2001 14 44 14.66666667
2002 18 56 18.66666667
2003 24 64 21.33333333
2004 22 66 22
2005 20 58 19.33333333
2006 16 61 20.33333333
2007 25 67 22.33333333
2008 26 85 28.33333333
2009 34 91 30.33333333
2010 31 -
Calculate the trend values using 4 yearly moving average method Problems on Moving Averages

2-year
4- year moving sum 4-Year
moving moving
Year Sales sum average
2000 58

2001 74
286
2002 86 594 74.25
308
2003 68 626 78.25 140
318
120
2004 80 660 82.5
342 100
2005 84 702 87.75 80
360
60
2006 110 734 91.75
40
374
2007 86 766 95.75 20
392 0
2008 94 800 100 2000 2001 2002 2003 2

408 Sales
2009 102 836 104.5 Linear (4-Year
428
2010 126 852 106.5
424
2011 106

2012 90

Problem 3-
Calculate 5-yearly moving average
5-yearly 5-yearly
Year Sales moving moving
sum average 5-yearly m
2012 10 - 60
2013 15 -
2014 18 89 17.8 50
2015 21 109 21.8 40
2016 25 127 25.4
2017 30 149 29.8 30
2018 33 178 35.6 20

10

0
2012 2013 2014 2015
 40

30

20
2019 40 -
10
2020 50 -
0
2012 2013 2014 2015

Sales
Linear (5-yearly moving av

Problem-4
Calculate 2- yearly moving average
2-year 2- year
moving 2-year moving
Months Profit sum moving sum average
Jan 1.2
2.7
Feb 1.5 5.6 1.4 2-ye
2.9
Mar 1.4 5.9 1.475 3

3 2.5
Apr 1.6 6.6 1.65
2
3.6
May 2 7.7 1.925 1.5
4.1
1
Jun 2.1 8.1 2.025
4 0.5
Jul 1.9 7.9 1.975
0
3.9 Jan Feb Mar Apr
Aug 2 8.2 2.05
Profit
4.3 Linear (2- yea
Sep 2.3 8.9 2.225
4.6
Oct 2.3 9.3 2.325
4.7
Nov 2.4 9.6 2.4
4.9
Dec 2.5
40

35

30

25

20

15

10

0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Production Moving average

Linear (Moving average)
 Chart Title
140
120
100
80
60
40
20
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Sales 4-Year moving average

Linear (4-Year moving average)

5-yearly moving average

2012 2013 2014 2015 2016 2017 2018 2019 2020

2012 2013 2014 2015 2016 2017 2018 2019 2020

Sales 5-yearly moving average

Linear (5-yearly moving average)

2-year moving average

3

2.5

1.5

0.5

0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Profit 2- year moving average

Linear (2- year moving average)
Straight line method
Y=a+bx
∑y=na+b∑x
xy=a∑x+b∑x^2
a=∑y/n
b=∑xy/∑x^2

Problem 1
fit a linear trend to the following data and find whether y-ye=0,where ye iscorresponding value of y also estimate for the
year Production(y) x xy x^2 trend (ye) y-ye
2015 18 -2 -36 4 20.6 -2.6
2016 21 -1 -21 1 20.8 0.2
2017 23 0 0 0 21 2 120
2018 27 1 27 1 21.2 5.8 100
2019 16 2 32 4 21.4 -5.4
80
105 0 2 10 0
60
a=∑y/n b=∑xy/∑x^2
40
a=105/5 b=2/10
a=21 b=0.2 20

0
y=a+bx 2015 2016
y=21+(0.2x) -20

Pro

Problem 2
Fit a straight line trend of the least sqaure method ,what is the monthly increase in production and estimate for the year

year production (y) x x^2 xy trend

2014 77 -3 9 -231 83
2015 88 -2 4 -176 85
2016 94 -1 1 -94 87 C
2017 85 0 0 0 89
120
2018 91 1 1 91 91
2019 98 2 4 196 93 100
2020 90 3 9 270 95
80
623 0 28 56
60
a=∑y/n b=∑xy/∑x^2
a=623/7 b=56/28 40
a=89 b=2
20

Y=a+bx 0
2014 2015 2016
Y=89+2x
pro
production for the year 2021=89+2(4)
production for the year 2021=98
production for the year 2022=89+2(5)
 production for the year 2022=99

Problem 3
Find the trend values for the following and estimate for 2022 Chart T
year no.of vehicle x xy x^2 Trend
1200
2015 160 -3 -480 9 160
2016 350 -2 -700 4 300 1000
2017 340 -1 -340 1 440
2018 580 0 0 0 580 800
2019 770 1 770 1 720
600
2020 910 2 1820 4 860
2021 950 3 2850 9 1000 400
4060 0 3920 28
200

0
a=∑y/n b=∑xy/∑x^2 2015 2016 2017 201
a=4060/7 b=3920/28 no.of vehicle
a=580 b=140

Y=a+bx
Y=580+140x

Production for the year 2022: Y=580+(140*40)

Production for the year 2022: Y=1140
value of y also estimate for the year 2020

Chart Title
120

100

80

60

40

20

0
2015 2016 2017 2018 2019
-20

Production(y) trend (ye) y-ye

ction and estimate for the year 2021 and 2022

Chart Title

2014 2015 2016 2017 2018 2019 2020

production (y) trend

 Chart Title

5 2016 2017 2018 2019 2020 2021

no.of vehicle Trend

weighted aggregate index number
1.Laspeyre's method
P01=p1q0/p0q0*100

2. Paasche' method
P01=p1q1/p0q1*100

3. Fisher's method
P01=√L*P

4. Bowley's method
P01=1/2((p1q0/p0q0)/(p1q1/p0q1)*100

5. Marshall-Edgeworth's method
P01= ((p1q0+p1q1/p0q0+p0q1))*100

6. Kelly's method
P01=p1q/p0q*100

Problems
problem 1
Calculate by simple aggregate method
Price in 2018 Price in 2020
162 171
256 164
257 189
132 145
807 669

Simple aggregate
method= p1/p0*100
P01=807/669*100 82.899628253
P01=82.9

Problem 2
calculate price index number
Commodities Prices
2019 2020 2021
cheese 120 150 180
Egg 6 8 10
tomato 15 20 35
141 178 225
P2020=p1/p0*100
P2020=178/141*100 1.2624113475
P2020=126.24

P2021=p1/p0*100
P2021=225/141*100 1.5957446809
P2021=159.57

Calculate all the weighted average methods for the following data

2015 2020
Commodities
Price(p0) Quantity(q0) Price(p1) Quantity(q1)
A 6 50 10 56
B 2 100 2 120
C 4 60 6 60
D 10 40 12 24
E 8 30 12 36

Laspeyre's method
P01=p1q0/p0q0*100
P01=1900/1380*100 1.376811594
P01=137.68

Paasche' method
P01=p1q1/p0q1*100
P01=1880/1344*100 1.398809524
P01=139.88

Marshall-Edgeworth's method
P01= ((p1q0+p1q1/p0q0+p0q1))*100 3780
P01=((1900+1880/1380+1344))*100 2724
P01=138.76 1.387665

Bowley's method
P01=1/2((p1q0/p0q0)/(p1q1/p0q1)*100 1.387811
P01=1/2((1900/1380)+(1880/1344)*100
P01=1/2(1.3988)+(1.3768)*100
P01=1/2(277.56)
P01=138.78

Fisher's method
P01=√L*P 138.7756405
P01=√137.68*139.88
P01=138.77

Compute Kelly's price index number

Price
Items Quantity
2015 2021 p1q
A 15 22 15.5 341
B 20 27 12.5 337.5
C 4 7 7.5 52.5
D 10 20 7.5 150
881
Kelly's method
P01=p1q/p0q*100
P01=881/587.5*100 1.499574468
P01=149.95

Problem 3
Calculate all weighted average method except kelly's method
2015 2020
Commodities price quantity price quantity
A 20 8 40 6
B 50 10 60 5
C 40 15 50 15
D 20 20 20 25

Laspeyre's method
p01=2070/1660*100 1.246987952
p01=124.69

Paasche' method
P01=p1q1/p0q1*100
p01=1790/1470 1.2176870748
P01= 121.17

Marshall-Edgeworth's method
P01= ((p1q0+p1q1/p0q0+p0q1))*100 123.3227
P01=(2070+1790/1660+1470)*100
P01=123.32

123.2338
Bowley's method
P01=1/2((p1q0/p0q0)/(p1q1/p0q1)*100
P01=1/2(2070/1660)+1790/1470))*100
P01=123.23

Fisher's method 122.9174

P01=√L*P
P01=√121.17*124.69
P01=122.91

Problem 4
Calculate fisher's index number
Commodities Base year Current Year
Price Expenditure Price Expenditure
A 2 40 5 75
B 4 16 8 40
C 1 10 2 24
D 5 25 10 60
p1q1 p0q0 p0q1 p1q0
560 300 336 500
240 200 240 200
360 240 240 360
288 400 240 480
432 240 288 360
1880 1380 1344 1900
p0q
232.5
250
30
75
587.5

p0q0 p1q0 p1q1 p0q1

160 320 240 120
500 600 300 250
600 750 750 600
400 400 500 500
1660 2070 1790 1470
TYPES:
1. unit test
2. time reversal test
3. factor reversal test
4. circular test

Fisher's index number satisfies TRT

FACTOR REVERSAL TEST
P01*Q01=V01
Where V01=P1Q1/P0Q0
P01=√(P1q1/p0q1)*(p1q0/p0q0)
Q01=√(p1q1/p1q0)*(p0q1/p0q0)

Problem 1
Prove that fisher's index number satisfies both TRT&FRT and calculate its value
Commodity Price(p0) quantity(q0) price(p1) quantity(q1) p1q1 p0q0 p1q0 p0q1
A 6 50 10 56 560 300 500 336
B 2 100 2 120 240 200 200 240
C 4 60 6 60 360 240 360 240
D 10 30 12 24 288 300 360 240
1448 1040 1420 1056
P01=√(1420/1040)*(1448/1056)
P10=√(1040/1420*(1056/1448)

Time Reversal Test Fisher's index number=√(14

P01*P10=√((1420/1040)*(1448/1056))*((1040/1420)*(1056/1448)) Fisher's index number=160
P01*p10=1(all the values are cancelled)

Q01=√(1056/1040)*(1448/1420)

Factor reversal test

P01*Q01=V01
√1420/1040)*(1448/1056)*√(1056/1040)*(1448/1420)=V01
√(1448/1040)2=V01
1448/1040=V01

In 2011 for working-class people wheat was selling at an average price of Rs. 16 per 10 kg., cloth at Rs. 4 per metre, house
 160.22569

Fisher's index number=√(1420/1040)*(1448/1056)*100

Fisher's index number=160.22

oth at Rs. 4 per metre, house rent at Rs. 50 per house and miscellaneous items at Rs. 20 per unit. By 2021 cost of wheat rose by Rs. 8 pe
f wheat rose by Rs. 8 per 10 kg., house rent by Rs. 30 per house and miscellaneous items doubled the price. The weights of the groups i
e weights of the groups in order were in the ratio 1 : 2 : 4 : 1. The working class cost of living index number for the year 2021 with 2011
the year 2021 with 2011 as base was 175%. By how much cloth price rIse during the period 2011 - 2021?