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Univariate Time-Series Analysis of Second-Hand Car Importation in Zambia

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Document pages: 14 pages

Abstract: Zambia largely depends on the international second-hand car (SHC) marketfor their motor vehicle supply. The importation of Second hand Cars in Zambiapresents a time series problem. The data used in this paper is monthly data onSHC importation from 1st January, 2014 to 31st December,2016. Data was analyzed using Exponential Smoothing (ES) and Autoregressive IntegratedMoving Average (ARIMA) models. The results showed that ARIMA (2, 1,2) was thebest fit for the SHC importation since its errors were smaller than those ofthe SES, DES and TES. The four error measures used were Root-mean-square error (RMSE), Mean absolute error (MAE), Mean percentage error (MPE)and Mean absolute percentageerror (MAPE). The forecasts were also produced using theARIMA (2, 1, 2) model for the next 18 months from January 2017. Although thereis percentage increase of 90.6 from November 2015 to December 2016, the SHCimportation generally is on the decrease in Zambia with percentage change of 59.5 from January2014 to December 2016. The forecasts also show a gradual percentage decrease of1.12 by June 2018. These results are moreuseful to policy and decision makers of Government departments such as ZambiaRevenue Authority (ZRA) and Road Development Agency (RDA) in a bid to plan andexecute their duties effectively.

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