Question

Given is a historical time series for job services demand in the prior 6 months.

Month	Demand
1	24
2	18
3	23
4	23
5	18
6	19

a) The MAE based on the Exponential smoothing α = 0.2 method =  (4 decimal places)

b) The MAE based on the 3 months moving average method = (in 4 decimal places)

c) Use MAE as an criterion to evaluate forecasting methods I (exponential smoothing, α = 0.2 ) and II (3 month moving average). The most accurate forecasting methods between I and II is method  (enter I or II)

Answer 1

a)

Time period	Actual Value(A)	Forecast(F)	Forecast error E=A-F	Squared Forecast Error
1	24
2	18	24.00	6.00	36.00
3	23	22.80	0.20	0.04
4	23	22.84	0.16	0.03
5	18	22.87	4.87	23.74
6	19	21.90	2.90	8.40
		Total	14.13	68.20
		Average	2.83	13.6396
			MAD	MSE

from above MAE =13.6396

b)

		3 week
Time period	Actual Value(A)	Moving avg. Forecast(F)	Forecast error E=|A-F|	Squared Forecast Error
1	24
2	18
3	23
4	23	21.67	1.33	1.78
5	18	21.33	3.33	11.11
6	19	21.33	2.33	5.44
		Total	7.00	18.33
		Average	2.33	6.1111
			MAD	MSE

MAE =6.1111

c)

II