The Carbondale Hospital is considering thepurchase of a new ambulance. The decis
ID: 2916277 • Letter: T
Question
The Carbondale Hospital is considering thepurchase of a new ambulance. The decision will rest partly on theanticipated mileage to be driven next year. The miles driven duringthe past 5 years are as follows.
Forecast the mileage for next year using a2-year moving average.
Round your answer to the nearest wholenumber; for example,1234 .
Find the MAD for your forecast in part(a).
Round your answer to the nearest wholenumber; for example,123 .
Use a weighted 2-year moving average withweights of .4 and .6 to forecast next year’s mileage. (Theweight of .6 is for the most recent year.)
Round your answer to the nearest wholenumber; for example,1234 .
What is the MAD of this forecast?
Round your answer tothe nearest whole number; for example,123 .
Round your answer to the nearest wholenumber; for example,1234 .
The Carbondale Hospital is considering thepurchase of a new ambulance. The decision will rest partly on theanticipated mileage to be driven next year. The miles driven duringthe past 5 years are as follows.
Year Mileage 1 3,200 2 4,000 3 3,300 4 3,900 5 3,700 (a) Forecast the mileage for next year using a2-year moving average.
Round your answer to the nearest wholenumber; for example,1234 .
(b)Find the MAD for your forecast in part(a).
Round your answer to the nearest wholenumber; for example,123 .
(c)Use a weighted 2-year moving average withweights of .4 and .6 to forecast next year’s mileage. (Theweight of .6 is for the most recent year.)
Round your answer to the nearest wholenumber; for example,1234 .
What is the MAD of this forecast?
Round your answer tothe nearest whole number; for example,123 .
(d)Compute the forecast for year 6 usingexponential smoothing, an initial forecast for year 1 of 3,200miles, and .
Round your answer to the nearest wholenumber; for example,1234 .
Explanation / Answer
a) 2-year moving average: (3700 + 3900)/2 = 3800 b) MAD is simply the average of the absolute errors: Year Mileage 2-yr MA Abs error 1 3200 2 4000 3 3300 3600 300 4 3900 3650 250 5 3700 3800 100 MAD = (300+250+100)/3 = 217 c) Weighted moving average: 0.6(3700) + 0.4(3900) = 3780 Note: the previous answerer was incorrectin his calculations here. MAD is calculated as such: Year Mileage Weighted MA Abserror 1 3200 2 4000 3 3300 3680 380 4 3900 3580 320 5 3700 3780 80 MAD = 260 d) Exponential forecasting Note: the previous answerer was incorrectin his calculations here. Mileage Forecast for next period 3200 4000 3600 = 0.5*4000 + 0.5*3200 3300 3450 = 0.5*3300 + 0.5*3600 3900 3675 3700 3688 The forecast is 3688.
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