2. The use of quarterly data to develop the forecasting model Yt = a +bYt−1 is an example of which forecasting technique?…
According to Schermerhorn (2013), “forecasting is the ability to predict the future” (pg.123) which means that the process of forecasting can become an important tool to quantify the proper balance between supply and demand. Likewise, in order to maximize sales and its effectiveness, businesses have to work in predict the future customer demand and use this information to lead the business operations to distribution effectively. However, inaccurate forecasts happen and along with them there is a cost.…
The best model should be the one with the smallest error. Among these three time-series models, the decomposition with exponential smoothing trend has the smallest MAPE and RMSE for both historical period and holdout period. Therefore, we use this model and the data from January 2001 to October 2011 to perform the ex-ante point and interval forecasts for the next 14 months as shown in table 2 and figure 4.…
The forecasting technique which involves the use of the least squares statistical method to examine trends, and takes into account seasonal and cyclical fluctuations, is known as…
1. Read Problem 6 in Chapter 6 of your textbook. Calculate and answer parts a through d. Include all calculations and spreadsheets in your post. Explain why the moving average method was used instead of another forecasting method. What might be another forecasting method that could prove to be just as useful?…
BUS 260Will AlmonteAssignment 21. The following data are monthly sales of jeans at a local department store. The buyer would like toforecast sales of jeans for the next month, July.a) Forecast sales of jeans for March through June using the naïve method, a two-period movingaverage, and exponential smoothing with an α = 0.2. (Hint: Use naïve to start the exponentialsmoothing process.)MonthSales Naïveb) Compare the forecasts using MAD and decide which is best.Exponential = MAD = Σ | actual – forecast | = 13.73 8+8+4+7/4= 6.75nNaïve = MAD = Σ | actual – forecast | = 8.25 10+10+5+8/4= 8.25n2 period = MAD = Σ | actual – forecast | = 8.25 2.5+15+10+8/4= 8.25nAnswer: Exponential is bestc) Using your method of choice, make a forecast for the…
* Historical data should be analyzed on a backward time line and compare the initial forecast and updated forecast. Variables such as standard deviation and covariance should be analyzed and applies to current forecasts.…
Suppose you (or your group) are the manager of a company trying to determine what forecasting method to use. Based upon the following historical data, calculate the following forecasts for each given forecasting method and then choose the best one to do the forecasts for the future.…
One way to improve their forecasting methods would be to incorporate a quantitative forecasting model. A quantitative forecasting model utilizes…
To improve the accuracy of the forecast, Merriwell Bag Company needs to identify the magnitude and form of each component on the basis of available past data. These components are then projected forward into the future. A reliable forecast will be obtained after this is done. This company needs to invest in better forecasting methods, build more flexibility into the company, and reduce the lead time over which forecasts are required to also improve the accuracy of the forecast.…
Forecasting is an important aspect in today's business world. Every day businesses strive or lose, depending on the successfulness and accurateness of their forecasting. For successful forecasting, the forecaster needs to have a clear understanding of the current business activities, past trends, and the company’s business strategy. Case 5 exhibits key principles on the way financial forecasting is done.…
Obtaining a reliable and accurate forecasting of future sales or market behavior is of paramount importance for business people such as policy makers, companies making investment decisions, setting up prices and so on. There are several forecasting methods and they are differently used by different companies to satisfy each one specific needs. Forecasting models companies use depend mainly of factors such as accuracy required, time horizon, availability of data and competent personnel (1995, Colgate, et al).…
3.2 Create trend lines in spreadsheet graphs to assist in forecasting for specified business information ……………………………………………………………………………………………………………………19-21…
Business forecasting is the process of studying historical performance for the purpose of using the information gained to project future business conditions so that decisions can be made today that will assist in the achievement of certain goals. Forecasting involves taking historical date and using it to project future data with a mathematical model. Forecasts are extensively used to support business decisions and direct the work of operations managers. In this paper I will introduce different types of forecasting techniques.…
e. You have now developed three different forecasts. These are a 3-year moving average, a weighted moving average, and a trend line. Which one would you use? Explain your answer.…