Forecasting

This exam is open books, open notes and open homework but NOT open talk and Not

open internet search$/$communication$!$ The exam is an individual work. Violation may

result in grade ZERO for your midterm.

The following table shows the sales of a product over a period of $7$ weeks.

Answer the following questions:

$1\mathrm{.}1(5$ points$)$ Please make a forecast for week $10$ using moving average $(3).$ Please also calculate

the mean absolution deviation $($MAD$)$ for this forecasting method

$1\mathrm{.}2(5$ points$)$ Please compute the optimal alpha using an exponential smoothing model. Please

make a forecast for week $10.$ Please also calculate the mean absolution deviation $($MAD$)$ for this

forecasting method. Hint:$($you can start with alpha$=0\mathrm{.}1).$

$1\mathrm{.}3(5$ points$)$ Using a Simple Linear Regression method, please make a prediction for period $10$

$($Hint: please use Anova table below to construct the equation for a fitted value$).$ Please also

calculate the mean absolution deviation $($MAD$)$ for this forecasting method.

$1\mathrm{.}3\mathrm{.}1(5$ points$)$ What $\%$ of variation in the data is explained by the model?

$1\mathrm{.}3\mathrm{.}2(5$ points$)$ What is the p$-$value of the slope $($week$)?$ Is there a significant relationship between

demand and time $($with a p value threshold of $5\%)?$

$1\mathrm{.}4.(10$ points$)$ Please determine the best forecasting model for the data above among MA$,$ ES and

LR$.$ The following table shows the sales of a product over a period of $7$ weeks.

Answer the following questions:

$1\mathrm{.}1(5$ points$)$ Please make a forecast for week $10$ using moving average $(3).$ Please also calculate the mean absolution deviation $($MAD$)$ for this forecasting method

$1\mathrm{.}2(5$ points$)$ Please compute the optimal alpha using an exponential smoothing model. Please make a forecast for week $10.$ Please also calculate the mean absolution deviation $($MAD$)$ for this forecasting method. Hint:$($you can start with alpha$=0\mathrm{.}1).$

$1\mathrm{.}3(5$ points$)$ Using a Simple Linear Regression method, please make a prediction for period $10($Hint: please use Anova table below to construct the equation for a fitted value$).$ Please also calculate the mean absolution deviation $($MAD$)$ for this forecasting method.

$1\mathrm{.}3\mathrm{.}1(5$ points$)$ What $\backslash (\backslash \%\backslash )$ of variation in the data is explained by the model? Q$4\mathrm{.}2(10$ points$)$

A team within the procurement department has undertaken an initiative to enhance the efficiency of managing suppliers. The primary objective is to minimize operational costs associated with supplier$-$related processes by reducing the fraction of suppliers with discrepancies or issues. The team has developed a clear operational definition for a problematic supplier: a supplier is considered problematic if it exhibits inconsistencies in pricing, delivers incorrect quantities, utilizes incorrect coding, provides inaccurate address information, or has incorrect contact names.

To assess the impact of their efforts, the team has adopted a method of randomly selecting and evaluating a sample of $100$ suppliers daily. If any of these randomly chosen suppliers are found to have one or more issues, they are labeled as problematic. The team has consistently applied this sampling methodology over the past $25$ days.

The data collected during the last $25$ days and already prepared for the assessment. $($see the excel file$).$

Please construct the SPC control to evaluate the process $($Please note, the data is preprocessed. Please build the chart$).$

What variation in the data does the p control chart discover?

Is the process in statistical control? What does this mean?

Is the process variation acceptable? What should be done next to the process of improving this process?