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. . . 4.33 Storrs Cycles has just started selling the new Cyclone mountain bike, with monthly sales as shown in the table. First co-owner Bob Day wants to forecast by exponential smoothing uar by initially setting February's forecast equal to January's sales with a = 1. Co-owner Sherry Snyder wants to use a three-period it a moving average. BOB'S SHERRY'S SALES BOB SHERRY ERROR ERROR JANUARY 400 FEBRUARY 380 400 MARCH 410 APRIL 375 MAY a) Is there a strong linear trend in sales over time? b) Fill in the table with what Bob and Sherry each forecast for May and the earlier months, as relevant. c) Assume that May's actual sales figure turns out to be 405. Complete the table's columns and then calculate the mean absolute deviation for both Bob's and Sherry's methods. d) Based on these calculations, which method seems more accurate?. 4.29 The number of disk drives (in millions) made at a plant in Taiwan during the past 5 years follows: YEAR DISK DRIVES 140 N 160 m 90 200 210 a) Forecast the number of disk drives to be made next year, using linear regression. b) Compute the mean squared error (MSE) when using linear regression. c) Compute the mean absolute percent error (MAPE). PXProblems 4.43-4.58 relate to Associative Forecasting Methods . . 4.43 Mark Gershon, owner of a musical instrument dis- tributorship, thinks that demand for guitars may be related to the number of television appearances by the popular group Maroon 5 during the previous month. Mark has collected the data shown in the following table: DEMAND FOR GUITARS W 6 5 10 MAROON 5 TV APPEARANCES 3 4 6 8 5 a) Graph these data to see whether a linear equation might describe the relationship between the group's television shows and guitar sales. b) Use the least-squares regression method to derive a forecasting equation. c) What is your estimate for guitar sales if Maroon 5 performed on TV nine times last month? d) What are the correlation coefficient (r) and the coefficient of determination (r2) for this model, and what do they mean? X following forecasting