The Carbondale Hospital is considering the purchase of a new ambulance. The deci

Question

The Carbondale Hospital is considering the purchase of a new ambulance. The decision will rest pary on the anticipated mileage to be driven next year. The miles driven during the past 5 years are as follows: Year Mileage 3.100 3.950 3,500 3,800 3,800 a) Using a 2-year moving average, the torecast for year 6miles (round your response to the nearest wole number). b) Ir a 2-year moving average is used to make the forecast,the MAD based on ths miles (round your response to one decimal piace). (Hint: You wll nave only 3 years or matcned date.) c) The forecast for year6 using a weighted 2-year moving average with weights of 0.40 and 0.60 (the weight of 0.60 is for the most recent period)miles (round your response to the nearest wnoie number). The MAD tor the forecast developed using a wear ted 2-year moving average with weights or 0.40 and 0.50 = miles round your response o one dec a place Hnt You Wilma e on 3 years or matched data d) Using exponential smoothing with = 0.50 and the forecast for year 1 being 3.100 the forecast ror year 6 = miles (round your response to the nearest whole number

Explanation / Answer

A.

Forecast for year 6 (2 year moving average) = average of the mileage in year 4 & 5

Forecast for year 6 (2 year moving average) = (3800+3800)/2 = 3800 miles

B.

MAD (2 year moving average) = average of the absolute difference between the actual and forecasted mileage

MAD (2 year moving average) = (25+75+150)/3 = 83.3

C.

Forecast for year 6 (2 year Weighted moving average) = .6*3800+.4*3800 = 3800 miles

MAD (2 year Weighted moving average) = (110+120+120)/3 = 116.7

D.

Forecast for year 6 (exponential moving average with alpha =.5) = (Previous actual mileage – previous forecasted mileage)*.5 +previous forecasted mileage

Forecast for year 6 (exponential moving average with alpha =.5) = (3800-3656.25)*.5 + 3656.25

Forecast for year 6 (exponential moving average with alpha =.5) = 3728.12 or 3728 miles

Working note:

Year Mileage 2 year MA Difference Absolute difference 1 3100 2 3950 3 3500 3525 -25 25 4 3800 3725 75 75 5 3800 3650 150 150 6 3800 Year Mileage 2 year WMA Difference Absolute difference 1 3100 2 3950 3 3500 3610 -110 110 4 3800 3680 120 120 5 3800 3680 120 120 6 3800 Year Mileage EMA with alpha = .5 1 3100 3100 2 3950 3100 3 3500 3525 4 3800 3512.5 5 3800 3656.25 6 3728.13

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.