Franklin Tooling, Inc., manufactures specialty tooling for firms in the paper-making industry. All of their products are engineer-to-order and so the company never knows exactly what components to purchase for a tool until a customer places an order. However, the company believes that weekly demand for a few components is fairly stable. Component 135.AG is one such item. The last 26 weeks of historical use of component 135.AG is recorded below. Week Demand Week Demand 1 2 3 4 5 6 7 8 9 10 11 12 13 137 136 143 136 141 128 149 136 134 142 125 134 118 14 15 16 17 18 19 20 21 22 23 24 25 26 131 132 124 121 127 118 120 115 106 120 113 121 119 Use OM Explorer’s Time Series Forecasting Solver to evaluate the following forecasting methods. Start error measurement in the fifth week, so all methods are evaluated over the same time interval. Use the default settings for initial forecasts.i. Naïve (1-Period Moving Average)ii. 3-Period Moving Averageiii. Exponential Smoothing, with α = .28iv. Trend Projection with Regressionv. Which forecasting method should management use, if the performance criterion it chooses is:• CFE?• MSE?• MAD?• MAPE?
Franklin Tooling, Inc., manufactures specialty tooling for firms in the paper-making industry. All of their products are engineer-to-order and so the company never knows exactly what components to purchase for a tool until a customer places an order. However, the company believes that weekly demand for a few components is fairly stable. Component 135.AG is one such item. The last 26 weeks of historical use of component 135.AG is recorded below.
| Week | Demand | Week | Demand |
|
1 2 3 4 5 6 7 8 9 10 11 12 13 |
137 136 143 136 141 128 149 136 134 142 125 134 118 |
14 15 16 17 18 19 20 21 22 23 24 25 26 |
131 132 124 121 127 118 120 115 106 120 113 121 119 |
Use OM Explorer’s Time Series
i. Naïve (1-Period Moving Average)
ii. 3-Period Moving Average
iii. Exponential Smoothing, with α = .28
iv. Trend Projection with Regression
v. Which forecasting method should management use, if the performance criterion it chooses is:
• CFE?
• MSE?
• MAD?
• MAPE?
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