Question

Consider the following data:

Monthly Profit of a Gym

Month	Jan-12	Feb-12	Mar-12	Apr-12	May-12	Jun-12	Jul-12	Aug-12	Sep-12
Profit ($)	6,500	6,253	5,514	5,357	5,425	6,278	8,119	6,390	6,090

Step 1 of 5:

Determine the three-period moving average for the next time period. If necessary, round your answer to one decimal place.

Step 2 of 5:

What are the MAD, MSE and MAPE scores for the three-period moving average? Round any intermediate calculations, if necessary, to no less than six decimal places, and round your final answer to one decimal place.

Step 3 of 5:

Determine the exponentially smoothed forecast for the next time period using a smoothing constant, αα, of 0.350.35. If necessary, round your answer to one decimal place.

Step 4 of 5:

What are the MAD, MSE and MAPE scores for the exponentially smoothed forecast? Round any intermediate calculations, if necessary, to no less than six decimal places, and round your final answer to one decimal place.

Step 5 of 5:

Based on the MAPE scores, which forecast is best?

Answer 1

for 3 period moving average:

		3 week
Time period	Actual Value(A)	Moving avg. Forecast(F)	Forecast error E=|A-F|	Squared Forecast Error	MAPE
1	6500
2	6253
3	5514
4	5357	6089.00	732.00	535824.00	0.1366
5	5425	5708.00	283.00	80089.00	0.0522
6	6278	5432.00	846.00	715716.00	0.1348
7	8119	5686.67	2432.33	5916245.44	0.2996
8	6390	6607.33	217.33	47233.78	0.0340
9	6090	6929.00	839.00	703921.00	0.1378
		Total	5349.6667	7999029.2222	0.7949
		Average	891.61	1333171.54	13.25%
			MAD	MSE	MAPE

for exponential smoothing:

Time period	Actual Value(A)	Forecast(F)	Forecast error E=A-F	Squared Forecast Error	MAPE
1	6500
2	6253	6500.00	247.00	61009.00	0.0395
3	5514	0.00	5514.00	30404196.00	1.0000
4	5357	1929.90	3427.10	11745014.41	0.6397
5	5425	3129.39	2295.62	5269848.23	0.4232
6	6278	6413.55	135.55	18373.80	0.0216
7	8119	6366.11	1752.89	3072632.12	0.2159
8	6390	6979.62	589.62	347651.60	0.0923
9	6090	6773.25	683.25	466834.55	0.1122
		Total	14645.03	51385559.71	2.54
		Average	1830.63	6423194.96	31.80%
			MAD	MSE	MAPE

Step 1 of 5: three-period moving average for the next time period =6866.3

Step 2 of 5:

MAD =891.6

MSE=1333171.5

MAPE =13.2%

Step 3 of 5

exponentially smoothed forecast for the next time period =6534.1

Step 4 of 5:

MAD =1830.6

MSE=6423194.9

MAPE =31.8%

Step 5 of 5:

three-period moving average is best