The Average Absolute Deviation And Anticipated Demand Assignment
1. The demands of gas oil (million gallons) from 2015 to 2021 are as follows. Please forecast the demand of 2022 using two approaches: one is Exponential Smoothing (alpha is 0.8); the other is Time Series Regression. And please calculate the mean absolute deviations (MADs) for the two forecasting approaches. Which model is the better choice for this case? (Please keep two after the decimal point). 2. There are actual seasonal demands of sea food (million cwt.) from 2018 spring to 2020 winter. Please use Seasonalized Regression to calculate the follow questions. (1) What are the seasons’ indexes for spring, summer, fall and winter, respectively? (2) What are forecast data of 2021 four seasons from spring to winter? (Please keep two after the decimal point). Section II: Provide Answers in detail to all the Questions in this Section ( , each question carries equal marks) 1. What is the product structure tree? How to use it to solve the factory material preparation? Please give an example to illustrate the logic and the meanings. 2. How to use Weighted Moving Average to forecast the future? Please give an example to illustrate the equation and the meanings. 3. When discuss the Mean Absolute Deviation, Mean Squared Error, Mean Error, what are their function? What are the corresponding equations? How to measure the forecasting results are good or bad according to uations? The Average Absolute Deviation And Anticipated Demand Assignment
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Answer 1):
Forecast using exponential smoothing =*(actual from past year)+(1-)* (last year forecast)
Without evidence, we presume that the projection for 2015 will match the level of demand for 2015.
MAD is the average absolute deviation between actual and anticipated demand.
- Explanation for step 1
Forecast for 2022 smoothed exponentially =84.28
MAD =7.14
Step 2/2
Time series regression:
The trend line’s equation will be provided by:
y =a+bx
intercept a = y
b = trend line’s slope
dxdy/dx2 =152/28 =5.43
a =Y̅-b*X̅ =72.43-5.43*2018 =-10885.3
Equation:
y =-10885.3+5.43x
Forecast for 2022 equals (10885.3 + 5.43 * 2022) = 94.16
Predictions from 2015 through 2021 and the MAD calculation:
- Explanation for step 2
MAD = 3.19
Time series regression approach is better.
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The Average Absolute Deviation And Anticipated Demand Assignment