Forecasting: Regression Analysis and Exponential Smoothing

Satisfactory Essays
Demand Forecasting Problems

Simple Regression

a) RCB manufacturers black & white television sets for overseas markets. Annual exports in thousands of units are tabulated below for the past 6 years. Given the long term decline in exports, forecast the expected number of units to be exported next year.
|Year |Exports |Year |Exports |
|1 |33 |4 |26 |
|2 |32 |5 |27 |
|3 |29 |6 |24 |

b) A small hospital is planning for future needs in its maternity wing. The data below show the number of births in each of the past eight years.
|Year |Births |Year |Births |
|1 |565 |5 |615 |
|2 |590 |6 |611 |
|3 |583 |7 |610 |
|4 |597 |8 |623 |

Use simple linear regression to forecast the annual number of births for each of the next three years. Determine the coefficient of determination for the data and interpret its meaning.

Moving Averages

IPC’s Plant estimates weekly demand for its many materials held in inventory. One such part, the CTR 5922, is being studied. The most recent 12 weeks of demand for the CTR 5922 are :
|Week |Demand in units |Week |Demand in units |
|1 |169 |7

You May Also Find These Documents Helpful

  • Good Essays

    Choose one of the forecasting methods and explain the rationale behind using it in real life. I would choose to use the exponential smoothing forecast method. Exponential smoothing method is an average method that reacts more strongly to recent changes in demand than to more distant past data. Using this data will show how the forecast will react more strongly to immediate changes in the data. This is good to examine when dealing with seasonal patterns and trends that may be taking place. I would…

    • 607 Words
    • 3 Pages
    Good Essays
  • Good Essays

    Forecasting In order for a business to be successful it must come up with the most accurate forecast possible so they can plan for the demands. There are forecasting tools that assist with making calculations to receive the best outcome by your company’s needs. The tools are moving average, weighted moving average and exponential smoothing. The moving average takes the total of actual demand for previous months then divides by the number of months added. The number of months that is used can…

    • 421 Words
    • 2 Pages
    Good Essays
  • Satisfactory Essays

    =0.50(83000) + 0.30(67000) + 0.15(64000) + 0.05(48000) = 41,500 + 20,100 + 9,600 + 2,400 = $73,600 $73,600 is the forecast for 2013 Q2. Using exponential smoothing with a weight of 0.6 on actual values: a) If sales are $45,000 and $50,000 for 2010 and 2011, what would you forecast for 2012? (The first forecast is equal to the actual value of the preceding year.) Actual values are 2010: $45,000 2011:…

    • 312 Words
    • 4 Pages
    Satisfactory Essays
  • Good Essays

    CHAPTER 4: FORECASTING TRUE/FALSE 1. Tupperware only uses both qualitative and quantitative forecasting techniques, culminating in a final forecast that is the consensus of all participating managers. False (Global company profile: Tupperware Corporation, moderate) 2. The forecasting time horizon and the forecasting techniques used tend to vary over the life cycle of a product. True (What is forecasting? moderate) 3. Sales forecasts are an input to financial planning, while demand forecasts…

    • 5941 Words
    • 51 Pages
    Good Essays
  • Satisfactory Essays

    Practice Problems: Chapter 4, Forecasting Problem 1: Auto sales at Carmen’s Chevrolet are shown below. Develop a 3-week moving average. |Week |Auto Sales | |1 |8 | |2 |10 | |3 |9 | |4 |11 | |5 |10 | |6 |13 | |7 |- | Problem 2: Carmen’s decides to forecast auto sales by weighting the three weeks as follows: |Weights Applied |Period…

    • 841 Words
    • 4 Pages
    Satisfactory Essays
  • Satisfactory Essays

    eightweek period have been 14, 9, 30, 22, 34, 12, 19, 23. a. Suppose that three-week moving averages are used to forecast sales. Determine the one-step-ahead forecasts for weeks 4 through 8. b. Suppose that exponential smoothing is used with a smoothing constant of α = 0.15. Find the exponential smoothing forecasts for weeks 4 through 8. c. Based on the MAD, which method did better? Solution: a. Week 4 5 6 7 8 b. and c. You may start ES forecast from week 1 or start ES forecast from week 4 using MA(3) forecast…

    • 718 Words
    • 3 Pages
    Satisfactory Essays
  • Satisfactory Essays

    exponential

    • 331 Words
    • 2 Pages

    Exponential Smoothing Forecasting Method with Naïve start Formula: Ft = α (At-1) + (1 – α) (Ft – 1) where: Ft Forecast for time t Ft – 1 Past forecast; 1 time ahead or earlier than time t At-1 Past Actual data; 1 time ahead or earlier than time t α (read as alpha) as a smoothing constant takes the…

    • 331 Words
    • 2 Pages
    Satisfactory Essays
  • Good Essays

    Regression Analysis

    • 1146 Words
    • 5 Pages

    Assignment # 1 Forecasting (Total marks: 100) Following 10 Problems are for submission Problem 1: [12] Registration numbers for an accounting seminar over the past 10 weeks are shown below: |Week 1 2 3 4 5 6 7 8 9 10 | |Registrations 24 23 28 30 38 32 36 40 44 40 | a) Starting with week 2 and ending with…

    • 1146 Words
    • 5 Pages
    Good Essays
  • Powerful Essays

    Technology Forecasting is a product of the 20th century. Prior forecasting efforts were largely based upon the assumption and guidance of recognized experts in a given field and little more scientific thought was put into a forecast. Beginning in the 1930’s, a much more structured and formulated approach was placed upon the investigation, research, and predictability of future technologies. The United States Government played a critical role in emergence of technology forecasting. One of the earliest…

    • 2704 Words
    • 11 Pages
    Powerful Essays
  • Powerful Essays

    STATISTICS FOR MGT DECISIONS FINAL EXAMINATION Forecasting – Simple Linear Regression Applications Interpretation and Use of Computer Output (Results) NAME SECTION A – REGRESSION ANALYSIS AND FORECASTING 1) The management of an international hotel chain is in the process of evaluating the possible sites for a new unit on a beach resort. As part of the analysis, the management is interested in evaluating the relationship between the distance of a hotel from the beach and the hotel’s…

    • 2349 Words
    • 10 Pages
    Powerful Essays