Year Demand 1 45 2 50 3 52 4 56 5 58
The number of heart surgeries performed at Heartville
General Hospital has increased steadily over the past sev-
eral years. The hospital’s administration is seeking the best
method to forecast the demand for such surgeries in year 6.
The data for the past 5 years are shown.
The hospital’s administration is considering the following
all methods are compared for the same years.
i. Exponential smoothing, with a = 0.6. Let the initial fore-
cast for year 1 be 45, the same as the actual demand.
ii. Exponential smoothing, with a = 0.9. Let the initial fore-
cast for year 1 be 45, the same as the actual demand.
iii. Trend projection with regression.
iv. Two-year moving average.
v. Two-year weighted moving average, using weights 0.6 and
0.4, with more recent data given more weight.
vi. If MAD is the performance criterion chosen by the admin-
istration, which forecasting method should it choose?
vii. If MSE is the performance criterion chosen by the admin-
istration, which forecasting method should it choose?
viii. If MAPE is the performance criterion chosen by the ad-
ministration, which forecasting method should it choose?
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