An analyst must decide between two different forecasting techniques for weekly s

Question

An analyst must decide between two different forecasting techniques for weekly sales of roller blades: a linear trend equation and the naive approach. The linear trend equation is Ft = 125 + 2.2t, and it was developed using data from periods 1 through 10. Based on data for periods 11 through 20 as shown in the table, which of these two methods has the greater accuracy if MAD and MSE are used? (Round your answers to 2 decimal places.)

t Units Sold

11 144

12 145

13 150

14 143

15 157

16 152

17 156

18 154

19 159

20 164

How do I set up the equation?

Explanation / Answer

For linear trend method we get these values
given Ft = 124 +2t

For t =11 then Ft = 124 + 2(11)=146

For t =12 then Ft = 124 +2(12)=148

For t =13 then Ft = 124 + 2(13)=150

For t =14 then Ft = 124 +2(14)=152

For t =15 then Ft = 124 + 2(15)=154

For t =16 then Ft = 124 +2(16)=156

For t =17 then Ft = 124 + 2(17)=158

For t =18 then Ft = 124 +2(18)=160

For t =19 then Ft = 124 + 2(19)=162

For t =20 then Ft = 124 +2(20)=164

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