Please answer the following:
- United Dairies, Inc., supplies milk to several independentgrocers throughout Dade County, Florida. Managers at United Dairieswant to develop a forecast of the number of half gallons of milksold per week. Sales data for the past 12 weeks are:
Week | Sales |
1 | 2,750 |
2 | 3,100 |
3 | 3,250 |
4 | 2,800 |
5 | 2,900 |
6 | 3,050 |
7 | 3,300 |
8 | 3,100 |
9 | 2,950 |
10 | 3,000 |
11 | 3,200 |
12 | 3,150 |
1. Compute four-week and five-weekmoving averages for the time series.
- Compute the MSE for the four-week and five-week moving averageforecasts.
- What appears to be the best number of weeks of past data(three, four, or five) to use in the moving average computation?The MSE for three weeks is 23527.78
- Show the exponential smoothing forecasts using α = 0.1.
- Applying the MSE measure of forecast accuracy, would you prefera smoothing constant of α=0.1 or α= 0.2 for the United Dairiessales time series?
- Are the results the same if you apply MAE as the measure ofaccuracy?
- What are the results if MAPE is used?
3.   Use exponentialsmoothing with a α = 0.4 to develop a forecast of demand for week13. What is the resulting MSE?
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