The following are two simple moving average models for a chain of restaurants SimpleKitchen. Which model...

Transcribed Image Text:

The following are two simple moving average models for a chain of restaurants SimpleKitchen. Which model should the researcher use for forecasting and interpret the prediction interval for that model WORKSHEET Moving Average for Sale1000 Method Dela Sale 1000 Length 47 NMsing o Moving Average Length 4 Accuracy Measures MAPE 44795 WORKSHEET Moving Average for Sale1000 Method 47 Sale1000 Length Ming Moving Average Length " Accuracy Measures MAJE 43.962 MAD 15012 MSO 20529 MAD 12575 MID 225964 Forecasts Period Forecast Lown Upper 30 140 14 Forecasts Period Forecast Lower Upper 342222 47505 $26646 a. Use MA(4) because it has the lowest MSD as compared to MA(9). The PI indicates that sales in period 48 will be between -1 and 61 dollars in sales. b. Use MA(9). The PI indicates 95 out of 100 times sales will be between 4.7 and 63 dollars c.Use MA(9) The PI indicates 95 out of 100 times sales will be between 4700 and 63000 dollars. d. Do not use either model to predict future sales because the MAPE shows the data misses actual by more than 43 to 44% on average. The following are two simple moving average models for a chain of restaurants SimpleKitchen. Which model should the researcher use for forecasting and interpret the prediction interval for that model WORKSHEET Moving Average for Sale1000 Method Dela Sale 1000 Length 47 NMsing o Moving Average Length 4 Accuracy Measures MAPE 44795 WORKSHEET Moving Average for Sale1000 Method 47 Sale1000 Length Ming Moving Average Length " Accuracy Measures MAJE 43.962 MAD 15012 MSO 20529 MAD 12575 MID 225964 Forecasts Period Forecast Lown Upper 30 140 14 Forecasts Period Forecast Lower Upper 342222 47505 $26646 a. Use MA(4) because it has the lowest MSD as compared to MA(9). The PI indicates that sales in period 48 will be between -1 and 61 dollars in sales. b. Use MA(9). The PI indicates 95 out of 100 times sales will be between 4.7 and 63 dollars c.Use MA(9) The PI indicates 95 out of 100 times sales will be between 4700 and 63000 dollars. d. Do not use either model to predict future sales because the MAPE shows the data misses actual by more than 43 to 44% on average.

Answer rating: 100% (QA)

Based on the given information the researcher should use MA4 for forecasting The reason is th... View the full answer