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: Period 1 2 3 4 56 7 8 Demand 68 75 70 74 69 72 80 78 F1 66 68 72 71 72 70 71 74 PREDICTED DEMAND F2 66 68 70 72 74 76 78 80 (a). Compute MAD for each set of forecasts. Given your results, which forecast appears more accurate? Explain. (b). Compute the MSE for each set of forecasts. Given your results, which forecast appe more accurate? (c). Compute MAPE for each data set. Which forecast appears to be more accurate?
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: Period 1 2 3 4 56 7 8 Demand 68 75 70 74 69 72 80 78 F1 66 68 72 71 72 70 71 74 PREDICTED DEMAND F2 66 68 70 72 74 76 78 80 (a). Compute MAD for each set of forecasts. Given your results, which forecast appears more accurate? Explain. (b). Compute the MSE for each set of forecasts. Given your results, which forecast appe more accurate? (c). Compute MAPE for each data set. Which forecast appears to be more accurate?
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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:
Period
1
2
3
4
5
6
7
8
Demand
F1
68 75 70 74 69 72 80 78
88NRNREN
66
68
72
71
72
70
71
74
PREDICTED
DEMAND
段66 68 70 77 74 75 78 80
F2
72
76
(a). Compute MAD for each set of forecasts. Given your results, which forecast appears
more accurate? Explain.
(b). Compute the MSE for each set of forecasts. Given your results, which forecast appe
more accurate?
(c). Compute MAPE for each data set. Which forecast appears to be more accurate?
Expert Solution
Step 1
In time series data there are different metrics one can measure. Given below, there are three important measures
If X is the variable and m is the forecast value of X then
- mean absolute deviation or MAD
2.mean square error or MSE
- mean absolute percentage error or MAPE
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