TheCarbondale Hospital is considering the purchase of a new ambulance.The decisi
ID: 1233462 • Letter: T
Question
TheCarbondale Hospital is considering the purchase of a new ambulance.The decision will rest partly on the anticipated mileage to bedriven next year. The miles driven during the past 5 years are asfollows.
Forecast the mileage for next year using a 2-year movingaverage.
Round your answer to the nearest whole number; forexample, 1234 .
Find the MAD for your forecast in part (a).
Round your answer to the nearest whole number; forexample, 123 .
Usea weighted 2-year moving average with weights of .4 and .6 toforecast next year’s mileage. (The weight of .6 is for themost recent year.)
Round your answer to the nearest whole number; forexample, 1234 .
What is the MAD of this forecast?
Round your answer to the nearest whole number; forexample, 123 .
Round your answer to the nearest whole number; forexample, 1234 .
TheCarbondale Hospital is considering the purchase of a new ambulance.The decision will rest partly on the anticipated mileage to bedriven next year. The miles driven during the past 5 years are asfollows.
Year Mileage 1 2,900 2 4,000 3 3,500 4 3,900 5 3,700 (a) Forecast the mileage for next year using a 2-year movingaverage.
Round your answer to the nearest whole number; forexample, 1234 .
(b)Find the MAD for your forecast in part (a).
Round your answer to the nearest whole number; forexample, 123 .
(c)Usea weighted 2-year moving average with weights of .4 and .6 toforecast next year’s mileage. (The weight of .6 is for themost recent year.)
Round your answer to the nearest whole number; forexample, 1234 .
What is the MAD of this forecast?
Round your answer to the nearest whole number; forexample, 123 .
(d)Compute the forecast for year 6 using exponential smoothing, aninitial forecast for year 1 of 2,900 miles, and .
Round your answer to the nearest whole number; forexample, 1234 .
Explanation / Answer
a) 2-year moving average: (3900 + 3700)/2 = 3800 b) MAD is simply the average of the absolute errors: Year Mileage 2-yr MA Abs error 1 2900 2 4000 3 3500 3450 50 4 3900 3750 150 5 3700 3700 0 MAD = 67 c) weighted moving average: 0.6(3700) + 0.4(3900) = 3780 MAD is calculated as such: Year Mileage Weighted MA Abserror 1 2900 2 4000 3 3500 3560 60 4 3900 3700 200 5 3700 3740 40 MAD = 100 d) Forecast for year 6 = 3694 Mileage Forecast 2900 4000 3450 3500 3475 3900 3688 3700 3694
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