Question
The following table contains the past 20 weeks package data. Week Packages 1 525 2 565 3 625 4 630 5 755 6 795 7
The following table contains the past 20 weeks package data.
Week | Packages |
1 | 525 |
2 | 565 |
3 | 625 |
4 | 630 |
5 | 755 |
6 | 795 |
7 | 805 |
8 | 795 |
9 | 825 |
10 | 900 |
11 | 875 |
12 | 995 |
13 | 1055 |
14 | 1185 |
15 | 1175 |
16 | 1215 |
17 | 1305 |
18 | 1385 |
19 | 1405 |
20 | 1475 |
a. Using simple exponential smoothing, compute three sets of forecasts for the number of packages for weeks 2 to 21, with values of 0.1, 0.4 and 0.9. Assume the forecast for week 1 is equal to the actual number of packages in week 1.
b. To visually see the difference between forecasts and actual number of packages, plot the actual number of packages as well as the three simple exponential smoothing forecasts computed in for weeks 1 to 20 on the same graph. Which value of produces the most responsive forecast? Explain why.
c. Calculate the MAD and Mean Absolute Percentage Error (MAPE) using the forecast errors for weeks 2-20 for each of the three sets of forecasts created in part (a). Which value seems to be the most appropriate?
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