Concept explainers
Amazon finds that sales in July are much greater relative to other months because of the Amazon Prime days in that month.
Assuming that an exponential smoothing model is used for
F t+1 = αDt + (1-α) Ft
increase value of alpha |
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decrease value of alpha |
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stay with the same alpha |
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decrease the expected forecast for the current month (Ft) |
On hearing our forecast, our clients probe - how sure are we about the forecast? Which measure of errror (among those stated below) should we best use to respond?
a. |
Root MSE (RMSE)
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b. |
Mean absolute percentage error (MAPE)
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c. |
Mean forecast error (Avg. error)
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d. |
Cumulative forecast error (CFE)
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- A seasonal index for a monthly series is about to be calculated on the basis of the past four years' accumulation of data. The four previous July values were 110, 135, 125, and 130. The four previous total year values were 1440, 1920, 1920, and 2400. Calculate the seasonal index for July If the total-year forecast for next year is 2400. What is the July forecast for next year?arrow_forward1. Which of the following is indicative of the season of heaviest demand when seasonality is measured on a quarterly basis? a. Seasonal index = .75 b. Seasonal index = 1.0 c. Seasonal index = 1.25 d. Seasonal index = 3.1 Answer: 2. The forecast calculated at the end of period t for period t+k is always the same for any value of k if the time series has systematic variability. A) True B) Falsearrow_forwardUse simple exponential smoothing with a -0.8 to forecast electric scooter sales at Guelph- Humber Inc. for July. Assume that the forecast for May was for 45 electric scooters. Round your answer to 1 decimal Electric Scooter Sales Month May 42 June 47 July 45 August 40 Weekly demand for medical masks for the last five weeks at Chopper Drug Store has been as follows: 92, 96, 100, 100 and 102 (listed from the oldest to most recent). Suppose a naive forecast was used to forecast demand. What would the MAD be for this situation? Enrollment in a particular Yoga class at Guelph Fitness Centre for the last five months has been 80, 86, 88, 88 and 90(listed from the oldest to most recent). Suppose a two-month mov average was used to forecast enrollment. What would the MSE be for this situation?arrow_forward
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- Below is a table containing data on product demand for the most recent three months along with the forecasts that had been made for those three previous months. Calculate the MAE (or MAD). Month Demand Forecast 1 308 310 2 388 390 3 344 342arrow_forwardThe following are monthly actual and forecast demand levels for May through December for units of a product manufactured by the Deborah Bishop Company in Des Moines: Month May June July August September October Actual Demand 105 82 110 112 108 106 130 120 Forecast Demand 100 108 97 98 108 102 105 107 November December For the given forecast, the tracking signal = MADS (round your response to two decimal places).arrow_forwardDemand for oil changes at Garcia's Garage has been as follows: Month January February March April May June July August Number of Oil Changes 38 55 56 60 58 01 70 52 a. Use simple linear regression analysis to develop a forecasting model for monthly demand. In this application, the dependent variable, Y, is monthly demand and the independent variable, X, is the month. For January, let X=1; for February, let X 2; and so on. The forecasting model is given by the equation Y=X (Enter your responses rounded to two decimal places)arrow_forward
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