Question

The chairperson of the department of management at Enormous State U wants to forecast the number of students who will enroll in production and operations management each semester. The chair has accumulated the following enrollment data for the past 8 semesters:

Semester 1         Students enrolled

1                                        400

2                                        450

3                                        350

4                                       420          

5                                       500

6                                      575

7                                      490

8                                      650

A.) Calculate a 3-period moving average for students enrolled for all the periods you can. Calculate MAE from this. Show all work.

B.) Calculate the exponential smoothing forecast with alpha = .2 for students enrolled for all periods you can. Calculate MAE from this. Show all work.

C.) Which method is better, based on MAE?

Answer 1

1)

C) the mean absolute error for 3 period moving average is low compared to exponential forecast.

So , 3 period moving average is better.