Question

Suppose a company has the following sales for the last six months (January – June):

Month |
Period |
Sales |

January |
1 |
16 |

February |
2 |
25 |

March |
3 |
20 |

April |
4 |
20 |

May |
5 |
31 |

June |
6 |
35 |

July |
7 |
26 |

August |
8 |
(a) |

**Use this information to answer the following 7
questions:**

6.Using January through July values, develop a linear trend equation for this time series (to 4 decimals). Please write the equation in the proper form.

7.Using your answer from (7), what is the average change in sales per month for this company (to 2 decimals)?

**I already have the answers to 1-5 I JUST NEED
6-7**

1.Use exponential smoothing (a= 0.10) to forecast the sales for August (to 2 decimals). What is the value?

2. Compute the MSE for the exponential smoothing method from the above question (to 2 decimals).

3.Use a 2-period moving average to forecast the sales for August (to 2 decimals). (i.e.find (a) using a 2-period moving average)

4. What is the mean square error (MSE) for the 2-period moving average from the previous question?

5. Which method do you prefer to forecast sales (to 2 decimals)? Why?

ANSWERS FOR 1-5

1) and 2)

Forecast 21.01

MSE:81.83

3) and 4)

FORECAST IS 30.5

MSE 53.35

5)we prefer moving average as its MSE is lower

Answer #1

**Solution 6**

So, linear trend equation for this time series is as follows:

**y = 16 +
2.1786*x**

**Solution 7**

Average change in sales per month for this company = Slope of linear trend equation = Coefficient of x = 2.1786

**Thus, the average change in sales per month for this
company is 2.18**

Suppose a company has the following sales for the last six
months (January – June):
Month
Period
Sales
January
1
16
February
2
25
March
3
20
April
4
20
May
5
31
June
6
35
July
7
26
August
8
(a)
Use this information to answer the following 7
questions:
ques 1 given the information above
1.Use exponential smoothing (a= 0.10) to forecast the sales for
August (to 2 decimals). What is the value?
2. Compute the MSE for...

Suppose a company has the following sales for the last six
months (January – June):
Month
Period
Sales
January
1
16
February
2
25
March
3
20
April
4
20
May
5
31
June
6
35
July
7
26
August
8
(a)
Use this information to answer the following 7
questions:
ques 1 given the information above
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equation for this time series (to 4 decimals). Please write the
equation in the...

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1
2
3
4
5
6
7
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23
14
18
14
20
23
16
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2
3
4
5
6
7
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22
13
18
12
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23
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2
3
4
5
6
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5
6
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2
14
3
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