Atime series model has been fitted and checked with historical data yielding:
Yt =27 + 0.42Yt-1 + et.
Supposethat at t = 40, Y40 = 37.
(a) Determinethe forecasts for periods 41 to 44 from origin 40.
(b) Supposethat the observed value of Y41 is 39. Update the forecasts forperiods 42 to 44.