bodyde:A manager wants to choose one of two forecasting alternatives: moving average and exponentialsmoothing. Each alternative was tested using historical data. The resulting forecast errors for thetwo are shown in the table.Period (t)Forecasting Errors using Moving AverageForecasting Errors using ExponentialSmoothing13423-22-3 342-1523(a) Calculate MAD for Moving Average Method and Exponential Smoothing Method(b) Calculate MSE for Moving Average Method and Exponential Smoothing Method645(c) Based on Part (a) and Part (b), which forecasting method (Moving Average or ExponentialSmoothing) should be used in this problem? Please explain your reasons.

Answered: A manager wants to choose one of two…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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The Carbondale Hospital is considering the purchase of a new ambulance. The decision will rest partly on the anticipated mileage to be driven next year. The miles driven during the past 5 years are as follows: Year Mileage 2 4,050 a) Using a 2-year moving average, the forecast for year 6= miles (round your response to the nearest whole number). b) If a 2-year moving average is used to make the forecast, the MAD based on this c) The forecast for year 6 using a weighted 2-year moving average with weights of 0.45 and 0.55 (the weight of 0.55 is for the most recent period) The MAD for the forecast developed using a weighted 2-year moving average with weights of 0.45 and 0.55 = d) Using exponential smoothing with a = 0.40 and the forecast for year 1 being 3,100, the forecast for year 6 = = 1 3,100 3 3,400 4 3,800 5 3,750 miles (round your response to one decimal place). (Hint You will have only 3 years of matched data.) miles (round your response to the nearest whole number) miles (round…
A forecasting method used to predict can opener sales applies the following set of weights to the last five periods of data: .1, .1, .2, .2, .4 (with .4 being applied to the most recent observation). Observed values of can opener sales arePeriod: 1 2 3 4 5 6 7 8Observation: 18 22 26 33 14 28 30 52Determine the following:a. The one-step-ahead forecast for period 9.b. The one-step-ahead forecast that was made for period 6.
An analyst must decide between two different forecasting techniques for weekly sales of roller blades: a linear trend equation and the nalve approach. The linear trend equation is F₂ =126-21t, and it was developed using data from periods 1 through 10. Based on data for periods 11 through 20 as shown in the table, which of these two methods has the greater accuracy of MAD and MSE are used? (Round your intermediate calculations and final answers to 2 decimal places.) t 12345671819 38 20 Units Sold 146 146 148 144 153 149 154 157 162 166 Click here for the Excel Data File MAD (Naive) MAD (Linear) MSE (Naive) MSE (Linear) provides forecasts with less average error and less average squared error.
An analyst must decide between two different forecasting techniques for weekly sales of roller blades: a linear trend equation and the naive approach. The linear trend equation is Ft = 124 + 2.1t, and it was developed using data from periods 1 through 10. Based on data for periods 11 through 20 as shown in the table, which of these two methods has the greater accuracy if MAD and MSE are used? (Round your intermediate calculations and final answers to 2 decimal places.) Units Sold 11 144 146 13 152 14 142 15 152 16 149 17 152 18 154 19 157 20 164 Click here for the Excel Data File MAD (Naive) 5.11 MAD (Linear) MSE (Naive) MSE (Linear) provides forecasts with less average error and less average squared error. H N M 4 56 r 00
Discuss the strengths and weaknesses of each of the forecasting modelsNaïve approach, Simple moving average, Weighted moving average, Exponential smoothing and Linear regression
A Use a simple moving average model. Experiment with the models using five weeks and three weeks past data. 3 week MA Week ATL BOS CHI DAL LA TOTAL 1 2 3 4 5 6 7 8 9 10 11 12 13 5 week MA Week ATL BOS CHI DAL LA TOTAL 1 2 3 4 5 6 7 8 9 10 11 12 13 B evaluate the forecast that would have been made over the 13 weeks using overall mean absolutely deviation, mean absolute percent error, and tracking signal as criteria.
2. An operation specialist used two forecast methods to forecast demand for a certain word processing software package. Actual demand and his corresponding predictions are shown below: Month Sales Forecast A Forecast B January 60 February 25 60 March 54 50 42 April 36 30 55 May 45 45 35 June 60 20 Which forecast method would you recommend if using MAD as the accuracy measurement? Select one: a. Forecast A b. Forecast B c. No preference.
All forecasting methods using exponential smoothing, adaptive smoothing, and exponential smoothing including trend require starting values to get the equations going. How would you select the starting value for, say, Ft21?
a) Apply moving average and exponential smoothing to generate two forecasts of the closing price for the entire data period. Set appropriate values for the forecast parameters (e.g., k and a). b) Plot and compare the actual and predicted data values you calculated in part (b). Provide one chart that displays actual, moving average, and exponential smoothing lines. Hint: Calculate MSE, MAD, or MAPE to compare the different forecasts. Develop your own forecast from scratch. Do NOT use Excel’s Data Analysis or Forecast Sheets.
4. The sales (in millions of dollars) for an 18-month period are as follows. Month Sales Month Sales 1 600 600 775 10 775 3 600 11 600 4 650 12 575 700 13 625 800 14 650 550 15 600 8 775 a. Compare a three-month moving average forecast with an exponential smoothing forecast. Use a = 0.1. Which provides the better forecasts based on MSE? b. Find the forecast for the next month using the best forecast method. 2.
FORECASTING- EXPONENTIAL SMOOTHING QUESTION 3 PERIOD АCTUAL 1 42 2 40 3 43 4 40 5 41 39 7 46 8 44 9. 45 10 38 11 40 12 a) Consider exponential smoothing forecasts using smoothing constants (a) 0.1 and 0.4
eBook Problem 6-05 Consider the following time series data. 3 16 Week 1 Week 2 Value 18 13 a. Choose the correct time series plot (1) € (!!!) Time Series Value Time Series Value 28642986420 284H2G86420 1 4 11 2 {B} 2 TH 3 Week (t) Week (t) 5 6 € (iv) Time Series Value Time Series Value 28642 NO 28642 NO 1 2 2 4 3₁ Week (t) Week (t) 5 6

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