Need 4 test performed both MA\'s at both expential smoothing points A company is
ID: 3134609 • Letter: N
Question
Need 4 test performed both MA's at both expential smoothing points
A company is evaluating forecasting methods for its monthly sales data. It has four methods to compare: moving average (n=3), moving average (n=5), exponential smoothing ( = 0.1), and exponential smoothing ( = 0.9). Forecasted values based on exponential smoothing are provided in the table. Assuming MAD has been chosen as the comparison standard, please compare the four methods. 12 points
Complete the two moving average forecasting by filling in the blanks in the table.
6 points
Calculate the MAD for each forecasting method and point out which forecasting method is the best in terms of MAD. 6 points
Month
Sales
MA (n=3)
MA (n=5)
Exponential ( = 0.1)
Exponential ( = 0.9)
1
20
20.0
20.0
2
21
20.0
20.0
3
15
20.1
20.9
4
14
19.6
15.6
5
13
19.0
14.2
6
16
18.4
13.1
7
17
18.2
15.7
8
18
18.1
16.9
9
20
18.1
17.9
10
20
18.3
19.8
11
21
18.4
20.0
12
23
18.7
20.9
Month
Sales
MA (n=3)
MA (n=5)
Exponential ( = 0.1)
Exponential ( = 0.9)
1
20
20.0
20.0
2
21
20.0
20.0
3
15
20.1
20.9
4
14
19.6
15.6
5
13
19.0
14.2
6
16
18.4
13.1
7
17
18.2
15.7
8
18
18.1
16.9
9
20
18.1
17.9
10
20
18.3
19.8
11
21
18.4
20.0
12
23
18.7
20.9
Explanation / Answer
MA(3)
MAD= =16.3 /12 =1.3583
MA(5)
MAD=1.467
Exponential alpha=0.1
MAD=31.9/12 =2.658
Exponential alpha=0.9
MAD=20.4/12 =1.7
Hence from above analysis MA(3) is best model since MAD is less compare to all
Month Sales MA (n=3) abs (Yi-Y hat) 1 20 2 21 3 15 18.7 3.7 4 14 16.7 2.7 5 13 14.0 1.0 6 16 14.3 1.7 7 17 15.3 1.7 8 18 17.0 1.0 9 20 18.3 1.7 10 20 19.3 0.7 11 21 20.3 0.7 12 23 21.3 1.7 Sum= 16.3Related Questions
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