Question

Week Time series Value
1 17
2 12
3 21
4 19
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Using the above data, calculate the Squared Error calculation for 3rd week. Consider Naïve forecast?

Answer 1

To calculate the Squared Error for the 3rd week using a Naïve forecast, we first need to define what a Naïve forecast is. The Naïve forecast for a given week is simply the value from the previous week.

For the 3rd week, the Naïve forecast will be the actual value from the 2nd week.

### Given Data:
- **Week 2 Value:** 12
- **Week 3 Actual Value:** 21

### Naïve Forecast for Week 3:
- **Naïve Forecast (Week 3):** 12 (this is the value from Week 2)

### Squared Error Calculation:
The Squared Error is calculated as:

\[
\text{Squared Error} = (\text{Actual Value} - \text{Forecasted Value})^2
\]

### Substituting the values:
- Actual Value = 21
- Forecasted Value = 12

\[
\text{Squared Error} = (21 - 12)^2 = 9^2 = 81
\]

So, the Squared Error calculation for the 3rd week using the Naïve forecast is **81**.