DETERMINING THEMEAN ABSOLUTE DWIATION MAD) During the past 8 uarters, the Port o
ID: 3175228 • Letter: D
Question
DETERMINING THEMEAN ABSOLUTE DWIATION MAD) During the past 8 uarters, the Port of Baltimore has unloadod large quantities of grain from ships. The port's operations manager wants to tost the use of exponential smoothing to sue how well the tochniq works in predicting tonnage unloaded. He gucases that the forucast of grain unloaded in the first quarter was 175 tons. Two values ofa are to be aamined: 10 and a APPROACH Compare the actual data with the data we forucast (using each of the two avalues) and then find the absolute deviation and MADs. SOLUTION The following table shows the detailed calculations for a 0 only: 75 2 168 175.50 17s00 +.10I80-175 17.50 3 19 174.7s 175.50 t.10168-17s.soo 17275 4 17s 12 3.18-1747s .10158 -1747s 16s 88 6 205 175.02-113.36 t-1019o 17336 18022 7 1so 178 02-17s02 10206-175.02 192.61 8 182 178 22-178 02 .10TI 80-178 186 30 To caluate the accuracy of oach smoothingoonstant t, we can compute forucast crrors in terms of abso- lute deviations and MADs: 159 17475 15.7s 172.7s 137s 175 173.18 1.82 165.88 9.12 190 17335 1664 170.44 1956 6 205 175.02 29.98 180.22 2478 180 17802 1 192.61 12.61 78.22 3.78 86.30 4.30 Sum of absolute deviations: 82.45 98.62 103Explanation / Answer
here what you are doing 175.5+.5*(168-175.5)
instead of that you need to replace 175.5 to 177.5 whcih is forecast for 2nd period. with alpha =0.5
by doing that forecast for 3rd period =177.5+.5*(168-177.5)= 172.75
please revert
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