Two different forecasting techniques (F1 and F2) were used to forecast demand for cases of bottled water. Actual demand and the two sets of forecasts are as follows: PREDICTED DEMAND Period Demand F1 F2 1 68 63 66 2 75 70 67 3 70 75 70 4 74 69 72 69 70 68 73 6. 72 75 80 70 77 8. 78 74 84 Click here for the Excel Data File a. Compute MAD for each set of forecasts. Given your results, which forecast appears to be more accurate? (Round your answers to 2 decimal places.) MAD F1 MAD F2
Two different forecasting techniques (F1 and F2) were used to forecast demand for cases of bottled water. Actual demand and the two sets of forecasts are as follows: PREDICTED DEMAND Period Demand F1 F2 1 68 63 66 2 75 70 67 3 70 75 70 4 74 69 72 69 70 68 73 6. 72 75 80 70 77 8. 78 74 84 Click here for the Excel Data File a. Compute MAD for each set of forecasts. Given your results, which forecast appears to be more accurate? (Round your answers to 2 decimal places.) MAD F1 MAD F2
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Two different forecasting techniques (F1 and F2) were used to forecast demand for cases of bottled water. Actual demand and the two
sets of forecasts are as follows:
TTT
PREDICTED DEMAND
Period
Demand
F1
F2
1
68
63
66
75
70
67
3
70
75
70
4
74
69
69
70
73
6.
72
68
7
80
70
77
8.
78
74
84
Click here for the Excel Data File
a. Compute MAD for each set of forecasts. Given your results, which forecast appears to be more accurate? (Round your answers to 2
decimal places.)
MAD F1
MAD F2
rON m574
O N N NNN
Transcribed Image Text:b. Compute the MSE for each set of forecasts. Given your results, which forecast appears to be more accurate? (Round your answers
to 2 decimal places.)
MSE F1
MSE F2
appears to be more accurate.
c. In practice, either MAD or MSE would be employed to compute forecast errors. What factors might lead a manager to choose one
rather than the other?
Either one might already be in use, familiar to users, and have past values for comparison. If
are used, MSE would be natural; if
are used, MAD woul
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