Solutions - Ch. 4 Practice Questions-2 PDF

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Solutions - Ch. 4 Practice Questions-2...

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Problem 4.2a The following table shows the actual demand observed over the last 11 years:

Year 1 2 3 4 5 6 7 8 9 10 11 Demand 7 8 5 10 11 9 13 13 8 9 7 This exercise contains only parts b, c, and d. b) Using the 3-year moving average, provide the forecast from periods 4 through 12 (round your responses to one decimal place). Year 4 5 6 7 8 9 10 11 12 Forecast 6.76.7 7.77.7 8.78.7 10.010.0 11.011.0 11.711.7 11.311.3 10.010.0 8.08.0 c) Using the 3-year weighted moving average with weights 0.20, 0.25, and 0.55, using 0.55 for the most recent period, provide the forecast from periods 4 through 12 (round your responses to two decimal places). Year 4 5 6 7 8 9 10 11 12 Forecast 6.156.15 8.358.35 9.559.55 9.709.70 11.6011.60 12.2012.20 10.2510.25 9.559.55 7.707.70 d) Mean absolute deviation for the forecast developed using the 3-year moving average is 2.61 and for the 3-year weighted moving average is 2.47. Based on this information, the better forecast is achieved using the weighted moving average approach.

Problem 4.3a The following table shows the actual demand observed over the last 11 years:

Year 1 2 3 4 5 6 7 8 9 10 11 Demand 7 9 4 9 11 8 12 14 9 13 7 Using exponential smoothing with α = 0.30 and a forecast for year 1 of 6.0, provide the forecast from periods 2 through 12 (round your responses to one decimal place). Year 1 2 3 4 5 6 7 8 9 10 11 12 Forecast 6.0 6.36.3 7.17.1 6.26.2 7.07.0 8.28.2 8.18.1 9.39.3 10.710.7 10.210.2 11.011.0 9.89.8 Provide the forecast from periods 2 through 12 using the naive approach (enter your responses as whole numbers).

Year 2 3 4 5 6 7 8 9 10 11 12 Forecast 77 99 44 99 1111 88 1212 1414 99 1313 77

Problem 4.8 Daily high temperatures in St. Louis for the last week were as follows: 92, 92, 94, 95, 95, 86, 90 (yesterday). a) The high temperature for today using a 3-day moving average = 90.3 degrees (round your response to one decimal place). b) The high temperature for today using a 2-day moving average = 88.0degrees (round your response to one decimal place). c) The mean absolute deviation based on a 2-day moving average = 2.8 degrees (round your response to one decimal place). d) The mean squared error for the 2-day moving average = 2 17.9degrees (round your response to one decimal place). e) The mean absolute percent error (MAPE) for the 2-day moving average = 3.2 (round your response to one decimal place).

Problem 4.14 Following are two weekly forecasts made by two different methods for the number of gallons of gasoline, in thousands, demanded at a local gasoline station. Also shown are actual demand levels, in thousands of gallons:

Actual Week Forecast Method 1 Demand 1 0.85 0.68 2 1.05 0.98 3 0.97 0.96 4 1.22 0.97

Actual Week Forecast Method 2 Demand 1 0.80 0.68 2 1.19 0.98 3 0.88 0.96 4 1.17 0.97

The MAD for Method 1 = 0.125 thousand gallons (round your response to three decimal places). The mean squared error (MSE) for Method 1 = 0.024 thousand gallons (round your response to three decimal places).

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The MAD for Method 2 = 0.153 thousand gallons (round your response to three decimal places). The mean squared error (MSE) for Method 2 = 0.026 thousand gallons (round your response to three decimal places).

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