3. Historical demand for a certain product (known till June) is as follows: Feb Mar Apr...

 

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3. Historical demand for a certain product (known till June) is as follows: Feb Mar Apr May June July Aug Sep Jan 12 11 C. 15 a. Is there a trend in the demand? Probably no. 12 16 b. Use a 3-month moving average to compute the July forecast. (15+16+12)/3 = 14.3 15 Assume that the forecast errors follow a Normal distribution. What is the standard deviation of the forecast errors? Using MA(3), Forecast for April -> 12.7 May -> 12.7 June -> 14.3 and we get MAD=1.56. Standard deviation is 1.25*1.56=1.95 d. Suppose an exponential smoothing is performed with a = 0.2 and a June forecast of 13. What is the forecast for July? 0.8*13+0.2*15= 13.4 3. Historical demand for a certain product (known till June) is as follows: Feb Mar Apr May June July Aug Sep Jan 12 11 C. 15 a. Is there a trend in the demand? Probably no. 12 16 b. Use a 3-month moving average to compute the July forecast. (15+16+12)/3 = 14.3 15 Assume that the forecast errors follow a Normal distribution. What is the standard deviation of the forecast errors? Using MA(3), Forecast for April -> 12.7 May -> 12.7 June -> 14.3 and we get MAD=1.56. Standard deviation is 1.25*1.56=1.95 d. Suppose an exponential smoothing is performed with a = 0.2 and a June forecast of 13. What is the forecast for July? 0.8*13+0.2*15= 13.4

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