QUESTION 8 You are given the following information, comprising of an individual's expenses for the year 2015. Use the information provided hereunder to answer the following questions. Month January February March April May June July August September October November December Expenses 1977 820 970 1082 1220 1281 1546 1788 895 1108 1824 1954 a) Determine the expenses forecast using a two (2) period moving average. Calculate the MAD and MSE. b) Determine the expenses forecast using a two (2) period weighted moving average. Use 0.8 & 0.2 for the weights of the most recent and second most recent periods respectfully. Calculate the MAD and MSE. c) Develop an exponential smoothing forecast using a=0.2. Assume the forecast for the first month is the actual expenses for that month. Calculate the MAD and MSE. d) Developed a trend line to forecast expenses

QUESTION 8 You are given the following information, comprising of an individual's expenses for the year 2015. Use the information provided hereunder to answer the following questions. Month January February March April May June July August September October November December Expenses 1977 820 970 1082 1220 1281 1546 1788 895 1108 1824 1954 a) Determine the expenses forecast using a two (2) period moving average. Calculate the MAD and MSE. b) Determine the expenses forecast using a two (2) period weighted moving average. Use 0.8 & 0.2 for the weights of the most recent and second most recent periods respectfully. Calculate the MAD and MSE. c) Develop an exponential smoothing forecast using a=0.2. Assume the forecast for the first month is the actual expenses for that month. Calculate the MAD and MSE. d) Developed a trend line to forecast expenses

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter13: Regression And Forecasting Models

Section13.7: Exponential Smoothing Models

Problem 29P: The file P13_29.xlsx contains monthly time series data for total U.S. retail sales of building...

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Under what conditions might a firm use multiple forecasting methods?
The file P13_42.xlsx contains monthly data on consumer revolving credit (in millions of dollars) through credit unions. a. Use these data to forecast consumer revolving credit through credit unions for the next 12 months. Do it in two ways. First, fit an exponential trend to the series. Second, use Holts method with optimized smoothing constants. b. Which of these two methods appears to provide the best forecasts? Answer by comparing their MAPE values.
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