The chairperson of the department of management at a university wants to forecas

Question

The chairperson of the department of management at a university wants to forecast the number of

students who will enroll in production and operations management (POM) next semester in order to

determine how many sections to schedule. The chair has accumulated the following enrollment data

for the past eight semesters.

Semester Students Enrolled in POM

1 400

2 450

3 350

4 420

5 500

6 575

7 490

8 650

a. Compute a three-semester moving average forecast for semesters 4 through 9.

b. Compute the exponentially smoothed forecast ( = .20) for the enrollment data.

c. Compare the two forecasts using MAD and indicate the more accurate

Please show the work. Thanks!

Explanation / Answer

Answers of all part is here in the given table.

The MAD for 3- month average is 80.33 and MAD for exponential smoothing = 87.15 , so 3- month moving average is more accurate.

Here for expontial smoothing Yt = 0.2 * At-1 + 0.8 Ft-1 formula has been applied.

Semester Students enrolled 3- sem Moving Average MAD Exponential smoothing (alpha = 0.2) MAD 1 400 #N/A #N/A 2 450 400 50 3 350 410 60 4 420 400 20 398 22 5 500 406.67 93.33333 402.4 97.6 6 575 423.33 151.6667 421.92 153.08 7 490 498.33 8.333333 452.536 37.464 8 650 521.67 128.3333 460.0288 189.9712 9 571.67 498.02304 498.023 MAD 80.33333 87.15931

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