HW For Chapter 18
HW For Chapter 18
Problem 3
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Last 100 125 135 175 185 200 150 140 130 200 225 250
year
To forecast the demand of the third quarter of this year using the three quarter moving
average method we’re gonna add the values of the actual three last month and divided by
the number of month
So with the three quarter moving average method we can say that for July, August and
September the forecasting demand will be 193.3, 194.3 and 192.52
Problem 11
a) If we use the three weeks moving average method we have to take the values of the
3 previous weeks and divide by the number of weeks.
So (400+600+700)/3 = 567
The forecasting demand for the next week should be approximately 567.
Problem 13
b)
Actual Exponential smoothing forecast
October = 65 +((0.2*(75-65)) = 67
The forecast for October will be 67.
c)
Demand (Y) Time (X) Time square Y*X
(X²)
April (60) 1 1 60
September 6 36 450
(75)
Problem 17
Month Actual
January 110
February 130
March 150
April 170
May 160
June 180
July 140
August 130
September 140
Initial Forecast for April (using the average of January through March):
(110+130+150)/3=130
For July, August, and September, continue the same process using the updated forecasts:
To decide which method produced the better forecast over the six-month period, we can use
the Mean Absolute Deviation (MAD). MAD measures the average magnitude of errors
between forecasts and actual values. The method with the lower MAD is considered to have
produced the better forecast.
Absolute Errors:
April: |170 - 160| = 10
May: |160 - 150| = 10
June: |180 - 160| = 20
July: |140 - 170| = 30
August: |130 - 160| = 30
September: |140 - 150| = 10
Comparing the MAD values, we find that the Three-Month Moving Average method has a
lower MAD of approximately 18.33, while the Simple Exponential Smoothing method has a
MAD of approximately 20.83. Therefore, based on the MAD criterion, the Three-Month
Moving Average method produced the better forecast over the six-month period.
Problem 20 :
For week number 6 the MAD is 104 and the tracking signal is 3.1 which is a lot. This
forecasting model is unacceptable because the value is too high.
Problem 25
X² =1² + 2² + 3² + 4² …. + 12²
= 650
January:
Average Sales/Overall Average Sales=110/130=0.8462
February:
Average Sales/Overall Average Sales=110/130=0.8462
March:
Average Sales/Overall Average Sales=154.5/130=1.1885
April:
Average Sales/Overall Average Sales=154.5/130=1.1885
May:
Average Sales/Overall Average Sales=123/130=0.9462
June:
Average Sales/Overall Average Sales=123/130=0.9462
July:
Average Sales/Overall Average Sales=176/130=1.3538
August:
Average Sales/Overall Average Sales=176/130=1.3538
September:
Average Sales/Overall Average Sales=103/130=0.7923
October:
Average Sales/Overall Average Sales=103/130=0.7923
November:
Average Sales/Overall Average Sales=110/130=0.8462
December:
Average Sales/Overall Average Sales=110/130=0.8462
January Forecast=(0.88×7+122.03)×0.8462
≈106.781
February Forecast=(0.88×8+122.03)×0.8462
≈108.141
March Forecast=(0.88×9+122.03)×1.1885
≈154.298
April Forecast=(0.88×10+122.03)×1.1885
≈156.483
May Forecast=(0.88×11+122.03)×0.9462
≈126.507
June Forecast=(0.88×12+122.03)×0.9462
≈128.155
July Forecast=(0.88×13+122.03)×1.3538
≈186.999
August Forecast=(0.88×14+122.03)×1.3538
≈189.535
September Forecast=(0.88×15+122.03)×0.7923
≈112.396
October Forecast=(0.88×16+122.03)×0.7923
≈113.904
November Forecast=(0.88×17+122.03)×0.8462
≈123.138
December Forecast=(0.88×18+122.03)×0.8462
≈124.680
January 106.781
February 108.141
March 154.298
April 156.483
May 126.507
June 128.155
July 186.999
August 189.535
September 112.396
October 113.904
November 123.138
December 124.680