Practical Management Science
6th Edition
ISBN: 9781337406659
Author: WINSTON, Wayne L.
Publisher: Cengage,
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Chapter 14.2, Problem 11P
Summary Introduction
To perform: Classification using NeuralTools and run the algorithm for second time using only the top five variables.
Introduction: Simulation model is the digital prototype of the physical model that helps to
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5. Table 1 shows the daily stock price of Apple Inc. (AAPL) in the past few trading days.
Table 1. Daily stock prices of Apple Inc.
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Date
Nov
Nov
Nov
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Nov
Nov
Nov
Nov
Stock
255.1 256.7 256.4 256.5 259.4 260.1 262.2 262
264.5 262.6 265.8 265.7
Price
Since the stock market closes on weekends, Table 1 only shows stock prices during weekdays. Please
answer the following questions based on the given information.
(a) Apply the moving average (MA) model with a three-day lag (q = 3) and a five-day lag (q =5) to forecast
Apple Inc.'s stock price in the following three trading days (i.e., its stock price on November 19, 20 and 21).
(Hint: calculate the stock price on November 19 first, and then use the estimated stock price of November
19 to forecast the stock price on November 20.) (ROUND TO ONE…
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- The Baker Company wants to develop a budget to predict how overhead costs vary with activity levels. Management is trying to decide whether direct labor hours (DLH) or units produced is the better measure of activity for the firm. Monthly data for the preceding 24 months appear in the file P13_40.xlsx. Use regression analysis to determine which measure, DLH or Units (or both), should be used for the budget. How would the regression equation be used to obtain the budget for the firms overhead costs?arrow_forwardThe file P13_26.xlsx contains the monthly number of airline tickets sold by the CareFree Travel Agency. a. Create a time series chart of the data. Based on what you see, which of the exponential smoothing models do you think will provide the best forecasting model? Why? b. Use simple exponential smoothing to forecast these data, using a smoothing constant of 0.1. c. Repeat part b, but search for the smoothing constant that makes RMSE as small as possible. Does it make much of an improvement over the model in part b?arrow_forwardThe file P13_27.xlsx contains yearly data on the proportion of Americans under the age of 18 living below the poverty level. a. Create a time series chart of the data. Based on what you see, which of the exponential smoothing models do you think will provide the best forecasting model? Why? b. Use simple exponential smoothing to forecast these data, using a smoothing constant of 0.1. c. Repeat part b, but search for the smoothing constant that makes RMSE as small as possible. Create a chart of the series with the forecasts superimposed from this optimal smoothing constant. Does it make much of an improvement over the model in part b? d. Write a short report to summarize your results. Considering the chart in part c, would you say the forecasts are good?arrow_forward
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