Question

QUESTION 11

1. Questions 11-12

   Q11. The past demand data shown below can be regarded as having a horizontal pattern. The naïve method ( Y'_t+1 = Y'_t ) was applied to make the forecasts for February – May.

   Month	Demand
   January	40
   February	45
   March	50
   April	32

   Q11. What are the mean absolute errors (MAE) for February, March, and April forecasts?

   	a.	9.33
   	b.	25.0
   	c.	84.75
   	d.	8.47
   	e.	None of the above

1.5 points   

QUESTION 12

1. Q12. What are the mean absolute percent errors (MAPE) for the February, March, and April forecasts?

   	a.	10.12%
   	b.	22.10%
   	c.	25.79%
   	d.	41.45%
   	e.	None of the above

Answer 1

Naive method is where the forecast for the current period is the same as previous period.

Eg: Forecast Feb = Actual Jan

Since we do not have any forecast for Jan, so we leave it lke that

Month	Demand	Forecast	Error	Abs Error	Percent abs error
January	40
February	45	40	5	5	11.11%
March	50	45	5	5	10.00%
April	32	50	-18	18	56.25%
Total				28	77.36%
Mean				9.33	25.79%

Here the error = Actual - forecast

Absolute error = only the error without any +ve and -ve signs

Absolute percent error = abs error / actual demand

Q11.

What are the mean absolute errors (MAE) for February, March, and April forecasts?

MAE = .................there are 3 pairs of actual and forecast values

= 28 / 3

a. 9.33

Q12  

What are the mean absolute percent errors (MAPE) for the February, March, and April forecasts?

The absolute percent error = Abs error / Actual demand

eg: APE for April = 18 / 32

MAPE =

c.

25.79%