To estimate: The probability that he will exercise his option. Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Question

Scenario You have been given a task to create a demand forecast for the second year of sales of a premium outdoor grill. Accurate forecasts are important for many reasons, including for the company to ensure they have the materials they need to create the products required in a certain period of time. Your objective is to minimize the forecast error, which will be measured using the Mean Absolute Percentage Error (MAPE) with a goal of being below 25%. You have historical monthly sales data for the past year and access to software that provides forecasts based on five different forecasting techniques (Naïve, 3-Month Moving Average, Exponential Smoothing for .2, Exponential Smooth for .5, and Seasonal) to help determine the best forecast for that particular month. Based on the given data, you will identify trends and patterns to create a more accurate forecast. Approach Consider the previous month's forecast to identify which technique is most effective. Use that to forecast the next…

Answer 1

Question

Chapter 11.3, Problem 28P

a)

Summary Introduction

To estimate: The probability that he will exercise his option.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

b)

Summary Introduction

To estimate: The net profit of his strategy.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

c)

Summary Introduction

To estimate: The probability that he will net over $300.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

d)

Summary Introduction

To estimate: The worth of the contract to him.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

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Scenario You have been given a task to create a demand forecast for the second year of sales of a premium outdoor grill. Accurate forecasts are important for many reasons, including for the company to ensure they have the materials they need to create the products required in a certain period of time. Your objective is to minimize the forecast error, which will be measured using the Mean Absolute Percentage Error (MAPE) with a goal of being below 25%. You have historical monthly sales data for the past year and access to software that provides forecasts based on five different forecasting techniques (Naïve, 3-Month Moving Average, Exponential Smoothing for .2, Exponential Smooth for .5, and Seasonal) to help determine the best forecast for that particular month. Based on the given data, you will identify trends and patterns to create a more accurate forecast. Approach Consider the previous month's forecast to identify which technique is most effective. Use that to forecast the next…

Approach Consider the previous month's forecast to identify which technique is most effective. Use that to forecast the next month. Remember to select the forecasting technique that produces the forecast error nearest to zero. For example: a. Naïve Forecast is 230 and the Forecast Error is -15. b. 3-Month Moving Forecast is 290 and the Forecast Error is -75. c. Exponential Smoothing Forecast for .2 is 308 and the Forecast Error is -93. d. Exponential Smoothing Forecast for .5 is 279 and the Forecast Error is -64. e. Seasonal Forecast is 297 and the Forecast Error is -82. The forecast for the next month would be 230 as the Naïve Forecast had the Forecast Error closest to zero with a -15. This forecasting technique was the best performing technique for that month. You do not need to do any external analysis-the forecast error for each strategy is already calculated for you in the tables below. Naïve Month Period Actual Demand Naïve Forecast Error 3- Month Moving Forecast 3- Month Moving…

Scenario You have been given a task to create a demand forecast for the second year of sales of a premium outdoor grill. Accurate forecasts are important for many reasons, including for the company to ensure they have the materials they need to create the products required in a certain period of time. Your objective is to minimize the forecast error, which will be measured using the Mean Absolute Percentage Error (MAPE) with a goal of being below 25%. You have historical monthly sales data for the past year and access to software that provides forecasts based on five different forecasting techniques (Naïve, 3-Month Moving Average, Exponential Smoothing for .2, Exponential Smooth for .5, and Seasonal) to help determine the best forecast for that particular month. Based on the given data, you will identify trends and patterns to create a more accurate forecast. Approach Consider the previous month's forecast to identify which technique is most effective. Use that to forecast the next…

Answer 2

Question

Chapter 11.3, Problem 28P

a)

Summary Introduction

To estimate: The probability that he will exercise his option.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

b)

Summary Introduction

To estimate: The net profit of his strategy.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

c)

Summary Introduction

To estimate: The probability that he will net over $300.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

d)

Summary Introduction

To estimate: The worth of the contract to him.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

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Answer 3

Question

Chapter 11.3, Problem 28P

a)

Summary Introduction

To estimate: The probability that he will exercise his option.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

b)

Summary Introduction

To estimate: The net profit of his strategy.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

c)

Summary Introduction

To estimate: The probability that he will net over $300.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

d)

Summary Introduction

To estimate: The worth of the contract to him.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

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Answer 4

Question

Chapter 11.3, Problem 28P

a)

Summary Introduction

To estimate: The probability that he will exercise his option.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

b)

Summary Introduction

To estimate: The net profit of his strategy.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

c)

Summary Introduction

To estimate: The probability that he will net over $300.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

d)

Summary Introduction

To estimate: The worth of the contract to him.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

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Answer 5

Chapter 11.3, Problem 28P

a)

Summary Introduction

To estimate: The probability that he will exercise his option.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

b)

Summary Introduction

To estimate: The net profit of his strategy.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

c)

Summary Introduction

To estimate: The probability that he will net over $300.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

d)

Summary Introduction

To estimate: The worth of the contract to him.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Answer 6

Chapter 11.3, Problem 28P

a)

Summary Introduction

To estimate: The probability that he will exercise his option.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Answer 7

Chapter 11.3, Problem 28P

a)

Summary Introduction

To estimate: The probability that he will exercise his option.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Answer 8

b)

Summary Introduction

To estimate: The net profit of his strategy.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Answer 9

b)

Summary Introduction

To estimate: The net profit of his strategy.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Answer 10

c)

Summary Introduction

To estimate: The probability that he will net over $300.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Answer 11

c)

Summary Introduction

To estimate: The probability that he will net over $300.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Answer 12

d)

Summary Introduction

To estimate: The worth of the contract to him.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Answer 13

d)

Summary Introduction

To estimate: The worth of the contract to him.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Answer 14

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Answer 15

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Answer 25

Ch. 11.2 - If the number of competitors in Example 11.1...Ch. 11.2 - In Example 11.1, the possible profits vary from...Ch. 11.2 - Referring to Example 11.1, if the average bid for...Ch. 11.2 - See how sensitive the results in Example 11.2 are...Ch. 11.2 - In Example 11.2, the gamma distribution was used...Ch. 11.2 - Prob. 6P Ch. 11.2 - In Example 11.3, suppose you want to run five...Ch. 11.2 - In Example 11.3, if a batch fails to pass...Ch. 11.3 - Rerun the new car simulation from Example 11.4,...Ch. 11.3 - Rerun the new car simulation from Example 11.4,...

To estimate: The probability that he will exercise his option. Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Solution Summary: The author explains that simulation model is the digital prototype of the physical model that helps to forecast the performance of a system or model in the real world.

Concept explainers

To estimate: The probability that he will exercise his option.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

To estimate: The net profit of his strategy.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

To estimate: The probability that he will net over $300.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

To estimate: The worth of the contract to him.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Chapter 11 Solutions

To estimate: The probability that he will exercise his option. Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Solution Summary: The author explains that simulation model is the digital prototype of the physical model that helps to forecast the performance of a system or model in the real world.

Concept explainers

To estimate: The probability that he will exercise his option. Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

To estimate: The net profit of his strategy. Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

To estimate: The probability that he will net over $300. Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

To estimate: The worth of the contract to him. Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

Chapter 11 Solutions

To estimate: The probability that he will exercise his option.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

To estimate: The net profit of his strategy.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

To estimate: The probability that he will net over $300.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

To estimate: The worth of the contract to him.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.