Question
Following table shows the monthly sales of cars at a dealership: Month Number of cars Sold...
- Following table shows the monthly sales of cars at a dealership:
|
Month |
Number of cars Sold |
||||
|
1 |
79 |
||||
|
2 |
79 |
||||
|
3 |
86 |
||||
|
4 |
93 |
||||
|
5 |
101 |
||||
|
6 |
107 |
||||
|
7 |
102 |
||||
|
8 |
Answer the following questions based on the data given above. Show your calculations.
- What is the Trend equation for the above data? (25 Points)
ANS:
- What is the expected sales for the 8th month based on the Trend method? (10 Points)
ANS:
- How much error is there in this forecasting method using MAD? (15 Points)
ANS:
Homework Answers
Answer #1
The linear regression equation is also called trend line
| 1 | 79 |
| 2 | 79 |
| 3 | 86 |
| 4 | 93 |
| 5 | 101 |
| 6 | 107 |
| 7 | 102 |
| 28 | 647 |
Sum of X = 28
Sum of Y = 647
Mean X = 4
Mean Y = 92.4286
Sum of squares (A) = 28 ( Sum of squares calculated in
worksheet at the down)
Sum of products (B = 140 ( Sum of producs calculated in
worksheet at the down)
Regression Equation = y=mx+c
b = B/A = 140/28 = 5
a = MY - bMX = 92.43 -
(5*4) = 72.42857
y= 5x + 72.42857
| y= 5x + 72.42857 |
Annexure : Calculations
| X-X1 | (x-x1)* (x-x1) | Y-Y1 | (x-x1) *( y-y1) |
| -3 | 9 | -13.4286 | 40.2857 |
| -2 | 4 | -13.4286 | 26.8571 |
| -1 | 1 | -6.4286 | 6.4286 |
| 0 | 0 | 0.5714 | 0 |
| 1 | 1 | 8.5714 | 8.5714 |
| 2 | 4 | 14.5714 | 29.1429 |
| 3 | 9 | 9.5714 | 28.7143 |
| -0.0002 | |||
| 28 | 140 |
Answer 2
X=8
| y= 5x + 72.42857 |
112.428
Answer 3
Population size:7
Mean= 92.428571428571
Mean Absolute Deviation (MAD): 9.5102040816327
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