A hospital is considering the purchase of a new ambulance. The decision will rest partly on the anticipated mileage to be driven next year. The miles driven during the past 5 years are as follows:
Year Mileage
1 3000
2 4000
3 3400
4 3800
5 3700
- Forecast the mileage for next year using 2-year moving average.
- Compute the forecast for year 6 using Naive method.
- Compute the forecast for year 6 using exponential smoothing, an initial forecast for year 1 is 3,000 miles and smoothening factor = 0.5.