Question: (POM for Windows or Excel OM) The following table represents quarterly data on the number of four-wheel drive sport-utility vehicles sold by a local Toyota
(POM for Windows or Excel OM) The following table represents quarterly data on the number of four-wheel drive sport-utility vehicles sold by a local Toyota dealer during the past three years.
SUV Sales (2019-Q1 2020-Q4)
| Year | Quarter | Time | Units Sold |
| 2018 | 1 | 1 | 23 |
| 2 | 2 | 25 | |
| 3 | 3 | 36 | |
| 4 | 4 | 31 | |
| 2019 | 1 | 5 | 26 |
| 2 | 6 | 28 | |
| 3 | 7 | 48 | |
| 4 | 8 | 36 | |
| 2020 | 1 | 9 | 31 |
| 2 | 10 | 42 | |
| 3 | 11 | 53 | |
| 4 | 12 | 43 |
For each of the following forecasting methods report their respective MAD and MAPE. Summarize all your findings in a table. Please, answer all letters below; A, B, C, D.
- Use regression analysis to fit a linear trend model to the data set (regression over time). Interpret your findings. What are the forecasts for the four quarters of 2020? Report and interpret the coefficient of determination.
- Use a simple exponential smoothing model to forecast sales for the first quarter of 2020. Use POM or Excel/OM, by setting the smoothing coefficient at = 0.25 and use the actual sales in the first quarter of 2019 as forecast, to start your forecasting process, (i.e. F1 = 23)
- Use the multiplicative decomposition model to forecast sales for the next four quarters of 2020. Report and interpret the significance of seasonal indexes (i.e. what do the seasonal indexes mean).
- Which model provides the best overall forecast for this data? Use MAPE as the criterion.
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