The Carbondale Hospital is considering the purchase of a new ambulance. The deci

Question

The Carbondale Hospital is considering the purchase of a new ambulance. The decision will rest partly on the anticipated mileage to be driven next year. The miles driven during the past 5 years are as follows:

a) Using a 2-year moving average, the forecast for year 6 =

nothing

miles

(round

your response to the nearest whole number).

b) If a 2-year moving average is used to make the forecast, the MAD based on this =

nothing

miles

(round

your response to one decimal place). (Hint: You will have only 3 years of matched data.)

c) The forecast for year 6 using a weighted 2-year moving average with weights of 0.45 and 0.55 (the weight of 0.55 is for the most recent period) =

nothing

miles

(round

your response to the nearest whole number).

The MAD for the forecast developed using a weighted 2-year moving average with weights of 0.45 and 0.55 =

nothing

miles

(round

your response to one decimal place). (Hint: You will have only 3 years of matched data.)

d) Using exponential smoothing with = 0.20 and the forecast for year 1 being 3,050, the forecast for year 6 =

nothing

miles

(round

your response to the nearest whole number)

years &    Mileage

1 yr, 3050

2yrs, 3950

3yrs,3400

4yrs,3850

5yrs, 3700

Explanation / Answer

a)

therefore forecast for year 6 = 3775

b) MAD =116.67

c)

from above:   forecast for year 6 using a weighted 2-year moving average =3767.5

MAD =133.33

d)

  forecast for year 6 = 3444.96

please revert for any clarification needed.

Year Mileage Forecast(F) |A-F| 1 3050 2 3950 3 3400 3500 100.00 4 3850 3675 175.00 5 3700 3625 75.00 6 3775 Total 350.00 Average 116.67

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