Question

In: Statistics and Probability

Table 6-3. Calculation of MAD Time Period      Actual Sales      3 Month Moving Average          Absolute Deviation     

Table 6-3. Calculation of MAD

Time Period      Actual Sales      3 Month Moving Average          Absolute Deviation        Weighted Moving Average

W=.1,.3,.6         Absolute Deviation        Exponential Smoothing Ft = 350 Absolute Deviation

1          230                                                      350      

2          238                                                      326      

3          260                                                      308      

4          275      243                  250                  299      

5          300      258                  267                  294      

6          285      278                  289                  295      

7          270      287                  289                  293      

8          290      285                  278                  289      

9          305      282                  284                  289      

10        320      288                  297                  292      

11        335      305                  313                  298      

12                    320                  328                  305      

SUM =  

                        n =                                                       

                        MAD   

73) Refer to Table 6-3. Calculate MAD for all forecasting models. The model you would use for your forecast, based on MAD is _____________________________________.

Please show work.  

Solutions

Expert Solution

MAD = 23.5

Moving averages - 3 period moving average
Data Forecasts and Error Analysis
Period Demand Forecast Error Absolute Squared Abs Pct Err
Period 1 230
Period 2 238
Period 3 260
Period 4 275 242.6667 32.33333 32.33333 1045.444 11.76%
Period 5 300 257.6667 42.33333 42.33333 1792.111 14.11%
Period 6 285 278.3333 6.666667 6.666667 44.44444 02.34%
Period 7 270 286.6667 -16.6667 16.66667 277.7778 06.17%
Period 8 290 285 5 5 25 01.72%
Period 9 305 281.6667 23.33333 23.33333 544.4444 07.65%
Period 10 320 288.3333 31.66667 31.66667 1002.778 09.90%
Period 11 335 305 30 30 900 08.96%
Total 154.6667 188 5632 62.61%
Average 19.33333 23.5 704 07.83%
Bias MAD MSE MAPE
SE 30.63767
Next period 320
Weighted moving averages - 3 period moving average
Data Forecasts and Error Analysis
Period Demand Weights Forecast Error Absolute Squared Abs Pct Err
Period 1 230 0.6 3 periods ago
Period 2 238 0.3 2 periods ago
Period 3 260 0.1 1 periods ago
Period 4 275 235.4 39.6 39.6 1568.16 14.40%
Period 5 300 248.3 51.7 51.7 2672.89 17.23%
Period 6 285 268.5 16.5 16.5 272.25 05.79%
Period 7 270 283.5 -13.5 13.5 182.25 05.00%
Period 8 290 292.5 -2.5 2.5 6.25 00.86%
Period 9 305 281 24 24 576 07.87%
Period 10 320 279.5 40.5 40.5 1640.25 12.66%
Period 11 335 297.5 37.5 37.5 1406.25 11.19%
Total 193.8 225.8 8324.3 75.00%
Average 24.225 28.225 1040.538 09.38%
Bias MAD MSE MAPE
SE 37.2476
Next period 312.5

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