Tesla is a world-leading manufacturer of electric cars. The Model 3 is Tesla's first car designed...

 

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Tesla is a world-leading manufacturer of electric cars. The Model 3 is Tesla's first car designed for the mass market. Table 1 shows the quarterly production numbers of Model 3 since its launch. In order to estimate Tesla's profitability and growth potential, an analyst at an investment bank is tracking the data and aims to forecast the production of Model 3. Quarter 2018 Q1 2018 Q2 2018 Q3 2018 Q4 2019 Q1 2019 Q2 Table 1 Model 3 Production 9,766 28,578 53,239 61,394 62,975 72,531 (a) Assuming the analyst applies Double Exponential Smoothing (DES) with a = 0.8 and B=0.4, what is the forecast for the production of Model 3 in 2019 Q3? Note: a is the smoothing parameter for the level estimate and ß is the smoothing parameter for the trend estimate. (15 marks) (b) What is the forecast accuracy of the DES method adopted in part (a), as measured by Mean Absolute Percentage Error (MAPE)? (5 marks) Tesla is a world-leading manufacturer of electric cars. The Model 3 is Tesla's first car designed for the mass market. Table 1 shows the quarterly production numbers of Model 3 since its launch. In order to estimate Tesla's profitability and growth potential, an analyst at an investment bank is tracking the data and aims to forecast the production of Model 3. Quarter 2018 Q1 2018 Q2 2018 Q3 2018 Q4 2019 Q1 2019 Q2 Table 1 Model 3 Production 9,766 28,578 53,239 61,394 62,975 72,531 (a) Assuming the analyst applies Double Exponential Smoothing (DES) with a = 0.8 and B=0.4, what is the forecast for the production of Model 3 in 2019 Q3? Note: a is the smoothing parameter for the level estimate and ß is the smoothing parameter for the trend estimate. (15 marks) (b) What is the forecast accuracy of the DES method adopted in part (a), as measured by Mean Absolute Percentage Error (MAPE)? (5 marks)

Answer rating: 100% (QA)

a The forecast for Model 3 product... View the full answer