Consider monthly demand for the ABC Corporation, as shown in the table. Sales Year 1 Year 2
Question:
Consider monthly demand for the ABC Corporation, as shown in the table. Sales
Year 1 Year 2 Year 3 Year4
January 2,000 3,000 2,000 5,000
February 3,000 4,000 5,000 4,000
March 3,000 3,000 5,000 4,000
April 3,000 5,000 3,000 2,000
May 4,000 5,000 4,000 5,000
June 6,000 8,000 6,000 7,000
July 7,000 3,000 7,000 10,000
August 6,000 8,000 10,000 14,000
September 10,000 12,000 15,000 16,000
October 12,000 12,000 15,000 16,000
November 14,000 16,000 18,000 20,000
December 8,000 10,000 8,000 12,000
Apply given forecasting models and calculate the demand for Year 5. Actual demand is given as follows.
Sales
Year 5
January 5,000
February 2,000
March 3,000
April 2,000
May 7,000
June 6,000
July 8,000
August 10,000
September 20,000
October 20,000
November 22,000
December 8,000
1. Constant Process-Average model. Find the bias, MAD, MSE, MAPE, and TS.
2. Trend Process-Regression model. Find the bias, MAD, MSE, MAPE, and TS.
3. Seasonal Process model. Find the bias, MAD, MSE, MAPE, and TS.
4. Which model would you use? Why?
Expert Answer:
