In Example 13.17 (page 722), quarterly advertising revenues of the New York Times were studied in conjunction with the moving-average model. For this exercise, consider a time series of monthly total revenues (advertising, circulation, and other revenue in thousands of dollars) starting in January 2005 and ending in October 2008.


 (a) Calculate and plot (on a single time series plot) moving averages

 (b) What do you observe? Are the moving averages trending? If so, describe the nature of the trend. Is there evidence of a shift? If so, over what period did the moving averages shift?

(c) Calculate a forecast for total monthly revenue for November 2008. Explain why the forecast for November 2008 will most

likely be close to the actual observation. For what months will the moving-average model be substantially off in its forecasts?for a span of k = 12.


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