The following gives the number of pints of type B blood used at Woodlawn Hospita

Question

The following gives the number of pints of type B blood used at Woodlawn Hospital in the past 6 weeks: a) Forecast the demand for the week of October 12 using a 3-week moving average. b) Use a 3-week weighted moving average, with weights of .1, .3, and .6, using .6 for the most recent week. Forecast demand for the week of October 12. c) Compute the forecast for the week of October 12 using exponential smoothing with a forecast for August 31 of 360 and alpha = .2. a) Plot the above data on a graph. Do you observe any trend, cycles, or random variations? b) Starting in year 4 and going to year 12, forecast demand using a 3-year moving average. Plot your forecast on the same graph as the original data. c) Starting in year 4 and going to year 12, forecast demand using a 3-year moving average with weights of .1, .3, and .6, using .6 for the most recent year. Plot this forecast on the same graph. d) As you compare forecasts with the original data, which seems to give the better results?

Explanation / Answer

4.1 a. Using three week moving average,

m3=(360+389+410)/3=1159/3=386.33

m4=(389+410+381)/3=1180/3=393.33

m5=(410+381+368)/3=1159/3=386.33

m6=(381+368+374)/3=1123/3=374.33

Forecast for October 12 is 374 (ans)

b. Using weighted moving average, the forecast for October 12 is as follows:

F12=0.6*374+0.3*368+0.1*381=372.9~373 (ans)

c. Using exponential smoothing method with smoothing constant, alpha=0.2.

M1=Y1=360

M2=0.2Y2+0.8M1=0.2*389+0.8*360=365.8

M3=0.2Y3+M2=0.2*410+0.8*365.8=374.64

M4=0.2Y4+M3=0.2*381+0.8*374.64=375.91

M5=0.2Y5+M4=0.2*368+0.8*375.91=374.33

M6=0.2Y6+M5=0.2*374+0.8*374.33=374.26

Forecast for August 31 is 374.

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