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University Book Store Computer Purchase Program

Satisfactory Essays

iii) University Book Store Student Computer Purchase Program

1. Background.

The Busy Biker is a bike shop located close to Tokyo University and owned by Nomura Hideki. He began the shop 20 years ago and sell new and second hand bicycle after fixing it too. The Business grew and demand continued to increase. Nomura must determine how many bicycles he need to have in stock at every beginning of semester. Below here is the data that help Nomura to forecast and to know how accurate will it be in assisting him in his business.

2. The Busy Biker Shop Data

|Year |Bikes Sold |
|1 |225 |
|2 |313 |
|3 |475 …show more content…

The average error result shows that the forecast figures are low bias from the actual figure too.

For Weighted Average Methods, 0.5 & 0.5 Weighted Averages will be used to compare with others methods due to MAD and E are the lowest, others are not accurate and it’s not advisable to use it in the estimations.

Using the Alpha 0.5, 0.6 & 0.7 Methods from the data.

|Items |0.5 (Alpha) |0.6 (Alpha) |0.7 (Alpha) |
|Mean Absolute Deviations (MAD) |178.43 |157.86 |148.99 |
|Average Error (E) |178.43 |155.14 |137.94 |
|Next period values |1,385 |1,435 |1,480 |

Result:

For the MAD (Mean Absolute Deviations), result shows that it’s high and its sign that the data are not very accurate. The average error result shows that the forecast figures are very bias from the actual figure.

Using Alpha 0.5, 0.6 & 0.7 Methods, only Alpha 0.7 Methods will be used to compare with other methods due to lower

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