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App Lecture 5

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Upasana Sharma
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6 views8 pages

App Lecture 5

Uploaded by

Upasana Sharma
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Merits:

1.Given the mathematical form of the trend to be fitted, the least squares method is an objective method.
2.Unlike the moving average method, it is possible to compute trend values for all the periods and predict the value for a period lying
outside the observed data.
3.The results of the method of least squares are most satisfactory because the fitted trend satisfies the two most important properties

4. The method can be used when the trend is linear, exponential, or quadratic.

Demerits:
1.As compared with the moving average method, it is cumbersome method.
2. It is not flexible like the moving average method. If some observations are added, then the entire calculations are to be done once
again.

Merits (Method of Moving Averages)

▪ The method of moving averages is simple and easy.


▪ This method is appropriate to remove, seasonal variations, cyclical fluctuations, and irregular variations.

Demerits (Method of Moving Averages)

▪ Some values at the beginning and the end of the series are lost.
▪ Moving averages are greatly affected by extreme values.
▪ The method does not provide a mathematical formula for the trend.

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