Forecasting Problems

Problem A

At Hard Rock's Moscow restaurant, the manager is trying to evaluate how a new advertising campaign affects guest counts.

1. Using data for the past 10 months (see the table below) develop a least squares regression relationship and then forecast the expected guest count when advertising is $65,000. Use the POM for Windows software Forecasting Module for your answer.
2. Open the Forecasting Results Screen, then click the Save as Excel file in the lower menu bar.
3. Submit your Excel file via the attachments button below.

Hard Rocks Moscow Cafe
Month	1	2	3	4	5	6	7	8	9	10
Guests (in thousands)	21	24	27	32	29	37	43	43	54	66
Advertising (in thousands)	14	17	25	25	35	35	45	50	60	60

Problem B

See auto sales at Carmen's Chevrolet (below).

Carmens Chevrolet
Week	Auto Sales
1	8
2	10
3	9
4	11
5	10
6	13
7

Please noteyou should be able to answer each of the problems below by using the same data entry; just change the type of forecast in the POM for Windows module software.

After you work problem 1, save that POM file, then save as a different name for problem 2. After you work problem 2, save that POM file, then save as a different name for problem 3. After you work problem 3, save that POM file.

1. Develop a three-week moving average. What is the forecast for period 7?
2. Develop an exponentially smoothed forecast with =0. What is the forecast for period 7?
3. Develop weighted moving average forecast with weights of 0.4 for last period, 0.3 for the next to last period, and 0.3 for the period before that. What is the forecast for period 7?
4. Using the detailed data in the POM module for each of the above iterations (In POM under WINDOW-2 Details and Error Analysis), which is the more accurate forecast using the MSE criteria? MAD? Explain your answer.

Please answer questions 1-4 at the bottom. Thank you!