Eli Orchid has designed a new pharmaceutical product, Orchid Relief, which improves the night sleep. Before initiating mass production of the product, Eli Orchid has been market-testing Orchid Relief in Orange County over the past 8 weeks. The daily demand values are recorded in the Excel file provided. Eli Orchid plans on using the sales data to predict sales for the upcoming week. An accurate forecast would be helpful in making arrangements for the companys production processes and designing promotions.

Before a forecasting model is built and a forecast for the next week is generated, the COO of the company has asked the data analyst for an exploratory analysis of the demand.

Specifically, the COO has asked the analyst[1]:

5. To write a short paragraph explaining the observations and providing general recommendations for the next seven days demand forecast.

[write your paragraph here]

6. To fit a new multiple regression model with dummy variables for seven days in a week (Mon, Tue, , Sun), and to provide the regression equation (d = a*t + b₁x₁ + b₂x₂ + b₃x₃ + b₄x₄ + b₅x₅ + b₆x₆ + c), along with R².

d =

R²=

7. To use all three models:

• M1: d = 1.0356t + 339.29
• M2: d = 0.7163t + 116.7679w + 315.0262
• M3: (the one considering weekdays)

to predict the demand for seven days ahead (Mon, Tue, , Sun) and find the total weekly demand.

	M1	M2	M3
Mon.
Tue.
Wed.
Thu.
Fri.
Sat.
Sun.
TOTAL:

8. Take advantage of the fact that new demand data became available and use this new data to compare the forecasts using MAPE for days 57-63.

New: M: 311 T: 341 W: 357 Th: 363 F: 390 Sa: 490 Su: 492

MAPE_M1:

MAPE_M2:

MAPE_M3:

9. To provide a line chart with the actual demand (including the new data) and M2 and M3.

10. To choose the best model for forecasting daily demand at Orchid Relief for 7 days ahead and write a short paragraph explaining your choice.

[write your paragraph here]

E2 fx =IF(OR($C2="Sat",$C2="Sun"),1,0) F. G H 1 J Check the formula 110 B D E 1 Day Date Weekday Daily Demand Weekend 2 1 4/25/16 Mon 297 al 3 2 4/26/16 Tue 293 4 3 4/27/16 Wed 327 5 4 4/28/16 Thu 315 6 5 4/29/16 Fri 348 7 6 4/30/16 Sat 447 1 8 7 5/1/16 Sun 431 1 9 8 5/2/16 Mon 283 10 9 5/3/16 Tue 326 0 11 10 5/4/16 Wed 317 0 12 11 5/5/16 Thu 345 0 13 12 5/6/16 Fri 355 0 14 13 5/7/16 Sat 428 1 15 14 5/8/16 Sun 454 1 16 15 5/9/16 Mon 305 0 17 16 5/10/16 Tue 310 0 18 17 5/11/16 Wed 350 0 19 18 5/12/16 Thu 308 0 20 19 5/13/16 Fri 366 0 21 20 5/14/16 Sat 460 1 22 21 5/15/16 Sun 427 1 23 22 5/16/16 Mon 291 0 24 23 5/17/16 Tue 325 0 25 24 5/18/16 Wed 354 0 26 25 5/19/16 Thu 322 0 27 26 5/20/16 Fri 405 0 28 27 5/21/16 Sat 442 1 29 28 5/22/16 Sun 454 1 30 29 5/23/16 Mon 318 0 31 30 5/24/16 Tue 298 0 32 31 5/25/16 Wed 355 0 33 32 5/26/16 Thu 355 0 34 33 5/27/16 Fri 374 0 35 34 5/28/16 Sat 447 1 36 35 5/29/16 Sun 463 1 37 36 5/30/16 Mon 291 0 38 37 5/31/16 Tue 319 0 39 38 6/1/16 Wed 333 0 40 39 6/2/16 Thu 339 0 41 40 6/3/16 Fri 416 0 42 41 6/4/16 Sat 475 1 43 42 6/5/16 Sun 459 1 44 43 6/6/16 Mon 0 45 44 6/7/16 Tue 326 0 46 45 6/8/16 Wed 356 0 47 46 6/9/16 Thu 340 0 48 47 6/10/16 Fri 395 0 49 48 6/11/16 Sat 465 1 50 49 6/12/16 Sun 453 1 51 50 6/13/16 Mon 307 0 52 51 6/14/16 Tue 324 0 53 52 6/15/16 Wed 350 0 54 53 6/10/16 Thu 348 0 55 54 6/17/16 Fri 384 0 56 55 6/18/16 Sat 474 1 57 56 6/19/16 Sun 485 1 58 319 E2 fx =IF(OR($C2="Sat",$C2="Sun"),1,0) F. G H 1 J Check the formula 110 B D E 1 Day Date Weekday Daily Demand Weekend 2 1 4/25/16 Mon 297 al 3 2 4/26/16 Tue 293 4 3 4/27/16 Wed 327 5 4 4/28/16 Thu 315 6 5 4/29/16 Fri 348 7 6 4/30/16 Sat 447 1 8 7 5/1/16 Sun 431 1 9 8 5/2/16 Mon 283 10 9 5/3/16 Tue 326 0 11 10 5/4/16 Wed 317 0 12 11 5/5/16 Thu 345 0 13 12 5/6/16 Fri 355 0 14 13 5/7/16 Sat 428 1 15 14 5/8/16 Sun 454 1 16 15 5/9/16 Mon 305 0 17 16 5/10/16 Tue 310 0 18 17 5/11/16 Wed 350 0 19 18 5/12/16 Thu 308 0 20 19 5/13/16 Fri 366 0 21 20 5/14/16 Sat 460 1 22 21 5/15/16 Sun 427 1 23 22 5/16/16 Mon 291 0 24 23 5/17/16 Tue 325 0 25 24 5/18/16 Wed 354 0 26 25 5/19/16 Thu 322 0 27 26 5/20/16 Fri 405 0 28 27 5/21/16 Sat 442 1 29 28 5/22/16 Sun 454 1 30 29 5/23/16 Mon 318 0 31 30 5/24/16 Tue 298 0 32 31 5/25/16 Wed 355 0 33 32 5/26/16 Thu 355 0 34 33 5/27/16 Fri 374 0 35 34 5/28/16 Sat 447 1 36 35 5/29/16 Sun 463 1 37 36 5/30/16 Mon 291 0 38 37 5/31/16 Tue 319 0 39 38 6/1/16 Wed 333 0 40 39 6/2/16 Thu 339 0 41 40 6/3/16 Fri 416 0 42 41 6/4/16 Sat 475 1 43 42 6/5/16 Sun 459 1 44 43 6/6/16 Mon 0 45 44 6/7/16 Tue 326 0 46 45 6/8/16 Wed 356 0 47 46 6/9/16 Thu 340 0 48 47 6/10/16 Fri 395 0 49 48 6/11/16 Sat 465 1 50 49 6/12/16 Sun 453 1 51 50 6/13/16 Mon 307 0 52 51 6/14/16 Tue 324 0 53 52 6/15/16 Wed 350 0 54 53 6/10/16 Thu 348 0 55 54 6/17/16 Fri 384 0 56 55 6/18/16 Sat 474 1 57 56 6/19/16 Sun 485 1 58 319