M7_A1. Jennifer Kelly is a WCU student who has just finished her junior year. The data in Worksheet A1 summarizes her grade point average (GPA) for each of the last 9 semesters.

1. a) Compute the forecasts using the nave forecasting method. What is the MAD?
2. b) Compute the forecast for Senior Year Fall Semester using the nave forecasting method.
3. c) Compute the forecasts using the two-period moving average. What is the MAPE?
4. d) Compute the forecast for Senior Year Fall Semester using the two-period moving average.
5. e) Compute the forecasts using the three-period weighted moving average using weights of 0.4, 0.35, and 0.25. What is the MAD?
6. f) Compute the forecast for Senior Year Fall Semester using the three-period weighted moving average using weights of 0.4, 0.35, and 0.25.
7. g) Use Solver to determine the weights for the three-year weighted moving average that minimizes the MAD? What is the MAD?
8. h) Compute the forecast for Senior Year Fall Semester using the three-period weighted moving average using weights determined by the Solver.
9. i) Compute the forecasts using exponential smoothing with a smoothing constant of 0.35 and a forecast for First Year Fall Semester of 2.41. What is the MSE?
10. j) Compute the forecast for Senior Year Fall Semester using exponential smoothing with a smoothing constant of 0.35 and a forecast for First Year Fall Semester of 2.41.
11. k) Comparing one of the error measurements (MAD, MSE, or MAPE) which is the best forecasting method? Which is the worst forecasting method?

M7_A2. A regional bus service examined their routes for the past 15 weeks. The data in Worksheet A2 provides and record of the total miles drive in each week.

1. a) Compute the forecasts using the four-period moving average. What is the MAPE?
2. b) Compute the forecast for Week 16 using the four-period moving average.
3. c) Compute the forecasts using exponential smoothing with a smoothing constant of 0.18 and a forecast for Week 1 of 22,500. What is the MAD?
4. d) Compute the forecast for Week 16 using exponential smoothing with a smoothing constant of 0.18 and a forecast for Week 1 of 22,500.
5. e) Use Solver to determine the value of the smoothing constant for the exponential smoothing method with forecast for Week 1 of 22,500 that minimizes MAD. What is the MAD?
6. f) Compute the forecast for Week 16 using the exponential smoothing method using the smoothing constant with forecast for Week 1 of 22,500 determined by the Solver.
7. g) Compute the forecasts using linear regression using Excels slope and intercept function. What is the MAD?
8. h) Compute the forecast for Week 16 using linear regression.
9. i)Comparingoneoftheerrormeasurements(MAD,MSE,orMAPE)whichisthebestforecastingmethod?Whichistheworstforecastingmethod?

M7_A3. Prices of diamond jewelry are based on the 4Cs of diamonds: cut, color, clarity, and carat. A jeweler is trying to estimate the price of diamond earrings based on color, carats, and clarity. The jeweler has collected some data on 22 diamond pieces and the data is shown in Worksheet A3. The jeweler would like to build a multiple regression model to estimate the price of the pieces based on color, carats, and clarity.

1. a) Prepare a scatter plot showing the relationship between the price and each of the independent variables.
2. b) If the jeweler wanted to build a regression model using only one independent variable to predict price, which variable should be used?
3. c) Why?
4. d) How do you use the value of Significance F in the model with only one independent variable?
5. e) If the jeweler wanted to build a regression model using two independent variables to predict price, which variable should be added to the one independent variable model?
6. f) Why?
7. g) If the jeweler wanted to build a regression model using three independent variables to predict price, which variable should be added to the two variable model?
8. h) Why?
9. i) Based on your best model, how should the jeweler price a diamond with a color of 2.75, a clarity of 3.00, and a weight of 0.85 carats?
10. j) How do you use the value of Significance F in the model with more than one independent variable?
11. k) Does there appear to be any multicollinearity among the independent variables?
12. l)Howcanyoutellifyouhavemulticollinearity?

M7_A4. A manufacturing engineer is responsible for the production of a chemical additive, XRX, used by one of their customers. The viscosity of the chemical additive is based on the quality of cellulose used in the formulation, the length of the cellulose fibers, and the amount of two materials used in the mixture, cellulose and EO. The engineer has recorded data for 37 lots of production. The engineer wants to estimate the viscosity of XRX based on cellulose quality, fiber length, lbs. of cellulose, and lbs. of EO. The data is shown in Worksheet A4.

1. a) Prepare a scatter plot showing the relationship between the viscosity and each of the independent variables.
2. b) If the engineer wanted to build a regression model using only one independent variable to predict viscosity, which variable should be used?
3. c) Do you think this is an acceptable model?
4. d) Which independent variables should be included in the best model the engineer can develop?
5. e) Based on your best model, what should the engineer expect the viscosity to be with a batch that has a cellulose quality of 20,000, a fiber length of 30.0, 9900 lbs. of cellulose in the batch, and 7500 lbs. of EO in the batch?

W6_A5. Jonas Julius runs a specialty chocolate shop in Asheville. The demand for his products appears seasonal and the data for the sales (in thousands but use these values for forecasting in the thousands do not change 42.9 to 42,900 in your calculations) for the last three years are shown in Worksheet A5. Develop a multiplicative decomposition model for Jonass sales data. Use the model to forecast sales for Year 4.

a) Compute the forecasts using linear regression the seasonally adjusted method. Note: you are trying to forecast for Year 4. What is the forecast with seasonality for Year 4 Quarter 1? Year 4 - Quarter 2? Year 4 Quarter 3? Year 4 Quarter 4?