Question

As one increases the number of periods used in the calculation of a moving average,a.greater emphasis is placed on more recent data.b.less emphasis is placed on more recent data.c.the emphasis placed on more recent data remains the same.d.it requires a computer to automate the calculations.e.one is usually looking for a long-term prediction.

Answer 1

As one increases the number of periods used in the calculation of a moving average, less emphasis is placed on more recent data. Therefore the answer is letter B. This is because moving average is derived from successive segments of a series of values. As the number of periods increase, the effect of recent data gets less significant.