Question

Question 1 contains the actual values for 12 periods (listed in order, 1-12). In Excel, create forecasts for periods 6-13 using each of the following methods: 5 period simple moving average; 4 period weighted moving average (0.63, 0.26, 0.08, 0.03); exponential smoothing (alpha = 0.23 and the forecast for period 5 = 53); linear regression with the equation based on all 12 periods; and quadratic regression with the equation based on all 12 periods. Round all numerical answers to two decimal places.

The actual values for 12 periods (shown in order) are:

(1) 45  (2) 52 (3) 48 (4) 59  (5) 55  (6) 58  (7) 64  (8) 61  (9) 71  (10) 66  (11) 69  (12) 77

1. Using a 5 period simple moving average, the forecast for period 13 will be:

2. Using the 4 period weighted moving average, the forecast for period 13 will be:

3. With exponential smoothing, the forecast for period 13 will be:

4. With linear regression, the forecast for period 13 will be:

5.With quadratic regression, the forecast for period 13 will be:

6. Considering only the forecasts for period 6-12, what is the lowest MAD value for any of the methods?

Answer 1

1)

Using a 5-period simple moving average,

The forecast for period 13 will be 68.8

2)

Using the 4-period weighted moving average,

Function =(F5*0.63+F4*0.26+F3*0.08+F2*0.03)

The forecast for period 13 will be:73.86

MAD=29.29

3)

With exponential smoothing

4)

With linear regression

5)

With quadratic regression:

6. Considering only the forecasts for period 6-12, MAD value for each method is

Moving average Length 5 =63.15

WMA =33.47

Exponential smoothing=102.42

Linear regression=8.86

Quadratic regression= 10.83

So the lowest MAD value for is for linear regression viz 8.86

PS: Don't forget to rate this answer.