Problem 8-1 Consider the following time series data. Week 12 45 6 Value 19 14 16

Question

Problem 8-1 Consider the following time series data. Week 12 45 6 Value 19 14 16 10 18 13 Using the naive method (most recent value) as the forecast for the next week, compute the following measures of forecast accuracy. (a) Mean absolute error If required, round your answer to one decimal place. (b) Mean squared error If required, round your answer to one decimal place. (c) Mean absolute percentage error If required, round your intermediate calculations and final answer to two decimal places. (d) What is the forecast for week 7?

Explanation / Answer

as we know for naive method; next month forecast =last month actual:

hence:

a)

MAD =5.2

b)

MSE =30.8

c)MAPE =38.22%

d)

forecast for week 7 =13

week value(A) Forecast(F) |A-F| (A-F)^2 |A-F|/A 1 19 2 14 19 5 25 0.36 3 16 14 2 4 0.13 4 10 16 6 36 0.60 5 18 10 8 64 0.44 6 13 18 5 25 0.38 7 13 Total 26 154 191.12% Average 5.2 30.8 38.22% MAD MSE MAPE

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