Holt-Winters with monthly data

In the video, you learned that the hw() function produces forecasts using the Holt-Winters method specific to whatever you set equal to the seasonal argument:

fc1 <- hw(aust, seasonal = "additive")
fc2 <- hw(aust, seasonal = "multiplicative")

Here, you will apply hw() to a10, the monthly sales of anti-diabetic drugs in Australia from 1991 to 2008. The data are available in your workspace.

Produce a time plot of the a10 data.
Produce forecasts for the next 3 years using hw() with multiplicative seasonality and save this to fc.
Do the residuals look like white noise? Check them using the appropriate function and set whitenoise to either TRUE or FALSE.
Plot a time plot of the forecasts.

Take Hint (-30 XP)

Exercise

Holt-Winters with monthly data

Instructions