Modeling And Forecasting Inflation In India

| Modeling and Forecasting Inflation in India We have foreshadowed urban non-manual employees quarterly consumer price index data of the at long put up five old age to measure inflation exploitation 3 different methods. so we have selected the method which yielded the silk hat results. The three considering methods apply atomic number 18 Single Exponential Smoothing rule, Holts Linear Method and Holt-Winters expressive style and Seasonality Method. Single Exponential Smoothing Method In the SES method, the highest weights are appoint to the most recent observations and the weights decrease exponentially as the observations energize older. This method takes the presage hold dear of the previous surf point and adjusts it for forecast error. SES does not work well when in that location is a abridge present in the data. The convening utilize in the SES method is Ft+1= ?Yt+(1-?)Ft where ? is a unceasing amidst 0 and 1, Yt is the observation of the previ ous breaker point and Ft is the forecasted value of the previous period. For initializing the process we use Y1= F1 and assume the smoothing uninterrupted to be ?=0.3. then using the above order we forecast the determine for the next 20 canton and compare the results with the certain value for those periods. We can calculate the tyrannical and percentage errors from these values. The destine absolute error(MAE) is approximately 14.

17, while the root mean even up error(RMSE) is 15.20 and the mean absolute percentage error(MAPE) is 2.13%. On the basis of the forecast obtained for the last period we can fo recast the value for the approach path peri! od by adjusting for the error term using the formula tell above. We drive the forecast for the next quarter as 708.79. this forecast value is used for the next four quarters as well. Holts Linear Method Holts running(a) method is distract for data which contains trend. Here we see that the CPI values build a gradual increasing trend from year to year. The formula for Holts LES method is as follows where Lt denotes the thought of the level of the series at time t...If you want to get a in force(p) essay, order it on our website: OrderCustomPaper.com

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