Question
The classified department of a monthly magazine has used a combination of quantitative and qualitative methods to forecast sales of advertising space. Results over a
The classified department of a monthly magazine has used a combination of quantitative and qualitative methods to forecast sales of advertising space. Results over a 20-month period are as follows:
Month | Error | Month | Error |
1 | -8 | 11 | 1 |
2 | -2 | 12 | 6 |
3 | 3 | 13 | 9 |
4 | 8 | 14 | 2 |
5 | 10 | 15 | 2 |
6 | 4 | 16 | -2 |
7 | 1 | 17 | -6 |
8 | -5 | 18 | -7 |
9 | -10 | 19 | -5 |
10 | -3 | 20 | -1 |
Click here for the Excel Data File
a. Compute a tracking signal for months 11 through 20. To do so, compute an initial value of MAD for month 11, and then update it for each month using exponential smoothing with = .2. (Leave no cells blank - be certain to enter "0" wherever required. Negative values should be indicated by a minus sign. Round your intermediate calculations and final answers to 3 decimal places.)
b-1. Using the first half of the data, construct a control chart with 2s limits. (Round your intermediate calculations to 3 decimal places and final answer to 2 decimal places.)
b-2. What can you conclude? multiple choice
All errors are within these limits.
Only the error for month 9 is outside of the limits.
Only the error for month 5 is outside of the limits.
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