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Moving Averages OCR Stage 8

Moving Averages

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Moving Averages. OCR Stage 8. Why use them?. Moving Averages, when graphed, allow us to see any trends in data that are cyclical By calculating the average of 2 or more items in the data, any peaks and troughs are smoothed out. 265. 269.25. 265.25. 270.75. 4 Period Moving Average. - PowerPoint PPT Presentation

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Page 1: Moving Averages

Moving Averages

OCR Stage 8

Page 2: Moving Averages

Why use them?

• Moving Averages, when graphed, allow us to see any trends in data that are cyclical

• By calculating the average of 2 or more items in the data, any peaks and troughs are smoothed out.

Page 3: Moving Averages

Year 1996 1997 1998

Quarter 1 2 3 4 1 2 3 4 1 2 3 4

Sales 189 244 365 262 190 266 359 250 201 259 401 265

265265.25

270.75

269.25

4 Period Moving Average

Page 4: Moving Averages

Year 1996 1997 1998

Quarter 1 2 3 4 1 2 3 4 1 2 3 4

Sales 189 244 365 262 190 266 359 250 201 259 401 265

4 period Moving Average

Quarters 1-4 2-5 3-6 4-7 5-8 6-9 7-10 8-11 9-12Moving Average 265 265.25 270.75 269.25 266.25 269 267.25 277.75 281.5

Page 5: Moving Averages

Year 1996 1997 1998Quarter 1 2 3 4 1 2 3 4 1 2 3 4

Sales 189 244 365 262 190 266 359 250 201 259 401 265

1 2 3 4 1 2 3 4 1 2 3 4

100

200

300

400

500

x

1996 1997 1998

x

x

x

x

x

x

xx

x

x

x

Quarters 1-4 2-5 3-6 4-7 5-8 6-9 7-10 8-11 9-12

Moving Average 265 265.25 270.75 269.25 266.25 269 267.25 277.75 281.5

x x x x x x x x x