4.5 The Carbondale Hospital is considering the purchase of a new ambulance. The decision will rest partly on the antici- pated mileage to be driven next year. The miles driven during the past 5 years are as follows: YEAR MILEAGE 3,000 4,000 3. 3,400 4 3,800 3,700 a) Forecast the mileage for next year (6th year) using a 2-year moving average. b) Find the MAD based on the 2-year moving average. (Hint: You will have only 3 years of matched data.) c) Use a weighted 2-year moving average with weights of 4 and 6 to forecast next year's mileage. (The weight of .6 is for the most recent year.) What MAD results from using this approach to forecasting? (IHint: You will have only 3 years of matched data.) d) Compute the forecast for year 6 using exponential smoothing. an initial forecast for year1 of 3,000 miles, and a 5. Px

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. 4.5
The Carbondale Hospital is considering the purchase
of a new ambulance. The decision will rest partly on the antici-
pated mileage to be driven next year. The miles driven during the
past 5 years are as follows:
YEAR
MILEAGE
1.
3,000
4,000
3,400
4.
3,800
5.
3,700
a) Forecast the mileage for next year (6th year) using a 2-year
moving average.
b) Find the MAD based on the 2-year moving average. (Hint.
You will have only 3 years of matched data.)
c) Use a weighted 2-year moving average with weights of .4
and 6 to forecast next year's mileage. (The weight of .6 is
for the most recent year.) What MAD results from using this
approach to forecasting? (Ilint: You will have only 3 years of
matched data.)
d) Compute the forecast for year 6 using exponential smoothing,
an initial forecast for year of 3,000 miles, and a
.5. Px
Transcribed Image Text:. 4.5 The Carbondale Hospital is considering the purchase of a new ambulance. The decision will rest partly on the antici- pated mileage to be driven next year. The miles driven during the past 5 years are as follows: YEAR MILEAGE 1. 3,000 4,000 3,400 4. 3,800 5. 3,700 a) Forecast the mileage for next year (6th year) using a 2-year moving average. b) Find the MAD based on the 2-year moving average. (Hint. You will have only 3 years of matched data.) c) Use a weighted 2-year moving average with weights of .4 and 6 to forecast next year's mileage. (The weight of .6 is for the most recent year.) What MAD results from using this approach to forecasting? (Ilint: You will have only 3 years of matched data.) d) Compute the forecast for year 6 using exponential smoothing, an initial forecast for year of 3,000 miles, and a .5. Px
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