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Forecast Accuracy Measures and Regression Analysis

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5. The chairperson of the department of management at State University wants to forecast the number of students who will enroll in production and operations management (POM) next semester, in order to determine how many sections to schedule. The chair has accumulated the following enrollment data for the past eight semesters:

Semester Students enrolled in POM
1 400
2 450
3 350
4 420
5 500
6 575
7 490
8 650

a. Compute a three semester moving average forecast for semesters 4 through 9.
b. Compute the exponentially smoothed forecast ( =.20) for the enrollment data.
c. Compare the two forecasts by using MAD and indicate the more accurate of the two.

11. The Whistle Stop Café in Weems, Georgia is well known for its popular homemade ice cream, made in a small plant in the back of the café. People drive all the way from Atlanta and Macon to buy the ice cream. The two women who own the café want to develop a forecasting model so they can plan their ice cream production operation and determine the number of employees they need to sell ice cream in the café. They have accumulated the following sales records for their ice cream for the past 12 quarters:

Year Quarter Ice Cream Sales (gal.)
2003 1 350
2 510
3 750
4 420
2004 5 370
6 480
7 860
8 500
2005 9 450
10 550
11 820
12 570

Develop an adjusted exponential smoothing model with =.50 and β =.50 to forecast demand and assess its accuracy using cumulative error (E) and average error. Does there appear to be any bias in the forecast?

19. Aztec Industries has developed a forecasting model that was used to forecast during a 10 month period. The forecasts and actual demand were as follows:

Month Actual Demand Forecast Demand
1 160 170
2 150 165
3 175 157
4 200 166
5 190 183
6 220 186
7 205 203
8 210 204
9 200 207
10 220 203

Measure the accuracy of the forecast by using MAD, MAPD and cumulative error (E). Does the forecast appear to be accurate?

23. The manager of the Ramona Inn Hotel near Cloverleaf Stadium believes that how well the local Blue Sox professional baseball team is playing has an impact on the occupancy rate at the hotel during the summer months. Following are the number of victories for the Blue Sox (in a 162 game schedule) for the past eight years and the hotel occupancy rates:

Year Blue Sox Wins Occupancy Rate (%)
1 75 83
2 70 78
3 85 86
4 91 85
5 87 89
6 90 93
7 87 92
8 67 91

Develop a linear regression model for these data and forecast the occupancy rate for next year if the Blue Sox win 88 games.

Solution Summary

This solution is comprised of detailed step-by-step calculations and explanation of various Forecast Techniques and various Forecast Accuracy Measures in EXCEL. Comparison of these Forecast Techniques based on these Forecast Accuracy measures has also been shown. The solution also provides a detailed Regression Analysis performed in EXCEL.

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