Question

The Carbondale Hospital is considering the purchase of a new ambulance. The decision will rest partly on the anticipated mileage to be driven next year. The miles driven during the past 5 years are as​ follows:

Year	1	2	3	4	5
Mileage	3,000	4,050	3,400	3,800	3,700

​a) Using a​ 2-year moving​ average, the forecast for year 6​ = ? miles ​(round your response to the nearest whole​ number).

​b) If a​ 2-year moving average is used to make the​ forecast, the MAD based on this​ = ? miles ​(round your response to one decimal​ place). ​ (Hint: You will have only 3 years of matched​ data.)

c) The forecast for year 6 using a weighted 2-year moving average with weights of 0.40 and 0.60 (the weight of 0.60 is for the most recent period) = ? miles (round your response to the nearest whole number)

The MAD for the forecast developed using a weighted 2-year moving average with weights of 0.40 and 0.60 = ? miles (round your response to one decimal place) (Hint: You will have only 3 years matched data.)

d) Using exponential smoothing with α = 0.20 and the forecast for year 1 being 3,000 the forecast for year 6 = ? miles (round your response to the nearest whole number)

Answer 1

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