What value ofnbspanbspis wamaco corp using in its


Given the data shown below, use .2 and b 5 .4 to create a trend enhanced smoothing based forecast for period 7. Assume that FIT1 22 and T1 7.83.

Period:

1

2

3

4

5

6

Demand:

19

33

37

49

52

60

1.  Calculate the slope and intercept for the above data using simple linear regression. You may want to use an Excel spreadsheet to check your answer.

2.  Wamaco Corporation uses the same simple exponential smoothing forecasting model for all of its products. The model has yielded the following weekly forecasts:

Week:

1

2

3

4

5

6

Product 1 forecast:

12

10.6

10.9

12.4

13.5

12.5

Product 1 sales:

10

11

13

14

12

10

Product 2 forecast:

102

100.6

103

104.4

104.8

108.4

Product 2 sales:

100

104

105

105

110

106

a. What value of is Wamaco Corp using in its forecasting model?

b. Calculate the forecast for period 7 for product 1 and product 2.

c. Using the first six periods of data, calculate the Bias (MFE), MAD, MPE, and MAPE. Does the forecasting model provide about the same bias and accuracy for both products? What would you recommend?

Text Book: Managing Operation Across the Supply Chain 2nd Edition.

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