Solved Problem 3

The monthly demand for units manufactured by the Acme Rocket Company has been as follows:

MyLab Operations Management Video

Month

Units

Month

Units

May     

100

September

105

June    

  80

October     

110

July    

110

November 

125

August

115

December 

120

  1. Use the exponential smoothing method to forecast the number of units for June to January. The initial forecast for May was 105 units; α=0.2.

  2. Calculate the absolute percentage error for each month from June through December and the MAD and MAPE of forecast error as of the end of December.

  3. Calculate the tracking signal as of the end of December. What can you say about the performance of your forecasting method?

Solution

  1. Current Month, t

    Calculating Forecast ...

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