Question 13 of 41
Q.Write any two limitations of the method of moving average.
Gujarat GsebGujarat Board (GSEB) HSC Commerce Board 2020Subjective· 2mImportance★★★★★
32% · 13/41 Questions
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Start your 14-day free trial to unlock the full solution →(1) Trend values for the first and last few periods are lost; (2) it provides no trend equation, so it cannot be used for forecasting.
Two limitations of the method of moving averages:
- Loss of terminal trend values. Because a moving average is centred, no trend value can be computed for the first few and the last few periods of the series. For a period of years, values are lost, which is a serious drawback for short series. …
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