Question

Ace Hardware handles spare parts for lawn mowers. The following data were collected for one week in May when replacement lawn-mower blades were in high demand:
Day Demand
1 .......... 10
2 .......... 12
3 .......... 13
4 .......... 15
5 .......... 17
6 .......... 20
7 .......... 21
a. Simulate a forecast for the week, starting with F1 = 10, T0 = 2, α = .2, and β = .4. Use the trend model given in the chapter supplement.
b. Compute the MAD and tracking signal for the data. Use MAD0 = 0.
c. Are the MAD and tracking signal within tolerances?
d. Simulate a forecast using simple smoothing for the week, starting with F1 = 10 and α = .2. Plot the forecast and the data on a graph. Note how the forecast lags behind the data.


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  • CreatedSeptember 20, 2015
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