A B D E F H K L M N 1 2 3 4 5 6 7 Carl Wright, Inc. specializes in direct mail coupon advertising for major food manufacturers. One client has run 10 advertising campaigns weekly using this medium. The response rate for cupouns for the lastg 10 campaigns which were taken consecutively over the last 10 weeks are as follows 8 9 10 11 Campaign Response % 12 1 4.6 13 2 5.2 14 3 4.8 15 4 5.3 16 5 4.5 17 6 5.9 18 7 5.2 19 8 5.4 20 21 9 10 4.7 4.9 22 23 24 25 26 27 a. Which model will provide more accurate forecasts of the response rate for future advertising campaigns: (1) 2-period Moving average (2) 6-period moving average. To answer do the following: (i) Apply MAE using the template. (ii) Demonstrate the MAE calculation of the 6-period moving on the given time series b. Use the better model of part 'a' to forecast the response rate for the next 2 weekly campaigns. Show your work. 28 29 30 31 c. Use Exponential Smoothing as follows: 32 (i) with Data Table determine the best alpha value based on MAE. Let alpha change in increments of 0.05. 33 34 (ii) Demonstrate the application of exponential smoothing using the alpha value you found above, for the first four periods only. (that is, show your calculations for the first 4 periods by applying the exponential smoothing method). 35 36 d. Use WMA of 3-periods, with W1 = 0.7, W2 = 0.2, and W3 = 0.1 to make the same forecasts as in question 'b'. 37 38 39 40 Problem 1 Answers +