Module 1: Trends

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Core Mathematics - Smoothing using moving averages

Smoothing using moving averages

Using this method, the values are smoothed by finding the averages of the
sets of data. If there are no cycles present, in general the larger the
sets selected the greater the smoothing effect. If there is a cyclic or
seasonal pattern then the maximum smoothing will be achieved by matching
the cycle length with the data set used for smoothing. For example, if
there is a three-month seasonal pattern, a data set of three values is
optimal for smoothing.

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