Question: How do you calculate the Squared Error to get the 81, 49, 1.78? 7. The following historical data have been collected representing sales of a

How do you calculate the Squared Error to get the

How do you calculate the Squared Error to get the 81, 49, 1.78?

7. The following historical data have been collected representing sales of a product. Compare forecasts using a three-period moving average, exponential smoothing with an a = 0.2, and linear regression. Using MAD and MSE, which forecasting model is best? Are your results the same using the two error measures? Week Demand 1 20 2 31 3 36 38 42 40 Solution Week Demand 3-period moving average Squared Error Exponential smoothing Absolute Error Squared Error 1 20 2 31 20 11 121 3 36 22.2 13.8 190.44 4 38 29 81 24.96 13.04 170.04 5 35 27.568 14.432 208.28 6 38.67 30.454 9.545 42 40 Absolute Error 9 7 1.33 4 5 6 49 1.78 91.118

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