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Media Consultants uses proven techniques to measure forecast accuracy and to determine when the forecast needs to be reviewed/updated. The following data has been
Media Consultants uses proven techniques to measure forecast accuracy and to determine when the forecast needs to be reviewed/updated. The following data has been extracted from their information system: Month 1 2 3 4 5 6 7 8 9 10 11 12 13. 14 15 16 17 18 19 20 Actual Sales ($million) 22 22 22 22 24 24 24 23 23 23 23 22 22 22 22 21 21 20 20 20 Forecast ($million) 30 24 18 15 15 19 24 26 32 27 22 16 14 18 21 23 25 28 25 21 a). Compute a tracking signal for months 11 through 20. Compute an initial value of MAD for month 11, and then update it for each month using exponential smoothing with alpha-.1. What can you conclude? Assume limits of +/-4. b). Using the first half of the data construct a control chart with 2s limits. What can you conclude? c). Plot the last 10 errors on the control chart. Are the errors random? What is the implication of this?
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Step: 1
a Use the following expression to compute the exponentially smoothened MAD MAD ale 1 aMADt1 The trac...Get Instant Access to Expert-Tailored Solutions
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