Question

Consider the following time series data. Week 1 2 3 4 5 6 Value 20 14 16 10 17 14 Using the naïve method (most recent value) as the forecast for the next week, compute the following measures of forecast accuracy. (a) Mean absolute error If required, round your answer to one decimal place. (b) Mean squared error If required, round your answer to one decimal place. (c) Mean absolute percentage error If required, round your intermediate calculations and final answer to two decimal places. (d) What is the forecast for week 7?

Answer 1

period	demand	forcast	forecast error=demand value-forecast value	absolute forecast error	squared forcast error	Abs %error
t	Dt	Ft	et=Dt-Ft	| et |	(et)²	| et/Dt |
1	20
2	14	20	-6	6	36	42.86%
3	16	14	2	2	4	12.50%
4	10	16	-6	6	36	60.00%
5	17	10	7	7	49	41.18%
6	14	17	-3	3	9	21.43%

	forecast error=demand value-forecast value	absolute forecast error	squared forcast error	Abs %error
	et=Dt-Ft	| et |	(et)²	| et/Dt |
total sum=	-6	24	134	177.96%
n=	5	5	5	5
average=	-1.2	4.8	26.8	35.59%

a)Mean absolute error =Σet/n =    -1.2

(b) Mean squared error =Σ(et)²/n =    26.8

(c) Mean absolute percentage error=Σ | et/Dt |/n =    35.59%

(d) What is the forecast for week 7=14