OPERATIONS AND SUPPLY CHAIN MANAGEMENT
9th Edition
ISBN: 9781119448037
Author: Russell
Publisher: WILEY
expand_more
expand_more
format_list_bulleted
Videos
Textbook Question
Chapter 12, Problem 1P
The Hartley-Davis motorcycle dealer in the Minneapolis–St. Paul area wants to be able to
- a. Compute a three-month moving average forecast of demand for April through January (of the next year).
- b. Compute a five-month moving average forecast for June through January.
- c. Compare the two forecasts computed in parts (a) and (b) using MAD. Which one should the dealer use for January of the next year?
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
The Hartley-Davis motorcycle dealer in the Minneapolis–
St. Paul area wants to be able to forecast accurately the de-mand for the Roadhog Super motorcycle during the next
month. From sales records, the dealer has accumulated thedata in the following table for the past year.
a. Compute a three-month moving average forecast ofdemand for April through January (of the next year).b. Compute a five-month moving average forecast forJune through January.c. Compare the two forecasts computed in parts (a) and(b) using MAD. Which one should the dealer use forJanuary of the next year?
Month Motorcycle SalesJanuary 9February 7March 10April 8May 7June 12July 10August 11September 12October 10November 14December 16
Daily high temperatures in St. Louis for the lastweek were as follows: 93, 94, 93, 95, 96, 88, 90 (yesterday).a) Forecast the high temperature today, using a 3-day movingaverage.b) Forecast the high temperature today, using a 2-day movingaverage.c) Calculate the mean absolute deviation based on a 2-daymoving average.d) Compute the mean squared error for the 2-day movingaverage.e) Calculate the mean absolute percent error for the 2-daymoving average.
a. Use a 3-month moving average to estimate the month-in-advance forecast of demand for months 4–12 and generate a forecast for the first month of next year. Calculate the average forecast error and mean absolute error.
b. Use a 3-month weighted moving average with weights of 0.6, 0.3, 0.1 (most recent to least recent, respectively) to calculate month-in-advance forecasts for months 4–12 and forecast for the first month of next year. Calculate the average forecast error and mean absolute error.
c. Compare the average forecast error and MAD for the forecasting methods in parts a and b. Based on these error calculations, which of the two forecast methods would you recommend? Why?
Chapter 12 Solutions
OPERATIONS AND SUPPLY CHAIN MANAGEMENT
Ch. 12 - List some of the operations and functions in a...Ch. 12 - What is the difference between quantitative...Ch. 12 - Describe the difference between short- and...Ch. 12 - Prob. 4QCh. 12 - Why is accurate forecasting so important to...Ch. 12 - Discuss the relationship between forecasting and...Ch. 12 - Prob. 7QCh. 12 - Describe the Delphi method for forecasting.Ch. 12 - What is the difference between a trend and a cycle...Ch. 12 - How is the moving average method similar to...
Ch. 12 - In the chapter examples for time series methods,...Ch. 12 - What effect on the exponential smoothing model...Ch. 12 - How does adjusted exponential smoothing differ...Ch. 12 - What determines the choice of the smoothing...Ch. 12 - How does the linear trend line forecasting model...Ch. 12 - Of the time series models presented in this...Ch. 12 - What advantages does adjusted exponential...Ch. 12 - Describe how a forecast is monitored to detect...Ch. 12 - Explain the relationship between the use of a...Ch. 12 - Selecting from MAD, MAPD, MSE, E, and E, which...Ch. 12 - What is the difference between linear and multiple...Ch. 12 - Define the different components (y, x, a, and b)...Ch. 12 - A company that produces video equipment, including...Ch. 12 - The Hartley-Davis motorcycle dealer in the...Ch. 12 - The manager of the I-85 Carpet Outlet needs to be...Ch. 12 - The LawnPlus Fertilizer Company distributes...Ch. 12 - Graph the demand data in Problem 12.3. Can you...Ch. 12 - The chairperson of the department of management at...Ch. 12 - The manager of the Excom Service Station wants to...Ch. 12 - The Intrepid mutual fund of growth stocks has had...Ch. 12 - The Oceanside Hotel is adjacent to City Coliseum,...Ch. 12 - Mary Hernandez has invested in a stock mutual fund...Ch. 12 - Globetron manufactures components for use in small...Ch. 12 - The Bee Line Caf is well known for its popular...Ch. 12 - For the demand data in Problem 12.11, develop a...Ch. 12 - Develop a seasonally adjusted forecast for the...Ch. 12 - Backstreets Pizza delivery service has randomly...Ch. 12 - The Willow River Mining Company mines and ships...Ch. 12 - The Great Northwest Outdoor Company is a catalog...Ch. 12 - Townside Food Vending operates vending machines in...Ch. 12 - The town aquatic center has an indoor pool that...Ch. 12 - Develop an adjusted exponential smoothing forecast...Ch. 12 - During the past five months the emergency room at...Ch. 12 - At its craft store and through its website, the...Ch. 12 - A group of business students at Tech organized a...Ch. 12 - Temco Industries has developed a forecasting model...Ch. 12 - Monitor the forecast in Problem 12.23 for bias...Ch. 12 - Develop a statistical control chart for the...Ch. 12 - Monitor the adjusted exponential smoothing...Ch. 12 - Develop an exponential smoothing forecast with =...
Additional Business Textbook Solutions
Find more solutions based on key concepts
• 4.3 Refer to Problem 4.2. Develop a forecast for years 2 through 12 using exponential smoothing with ? =.4 an...
Operations Management: Sustainability and Supply Chain Management (12th Edition)
Create an Excel spreadsheet on your own that can make combination forecasts for Problem 18. Create a combinatio...
Operations Management: Processes and Supply Chains (11th Edition)
What is precedent, and how does it affect common law?
Business in Action
The best fits using exponential smoothing, trend analysis, and linear regression for the given data. Introducti...
Principles of Operations Management: Sustainability and Supply Chain Management (10th Edition)
What are the three historical milestones in operations management? How have they influenced management?
Operations Management, Binder Ready Version: An Integrated Approach
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.Similar questions
- Under what conditions might a firm use multiple forecasting methods?arrow_forwardThe file P13_42.xlsx contains monthly data on consumer revolving credit (in millions of dollars) through credit unions. a. Use these data to forecast consumer revolving credit through credit unions for the next 12 months. Do it in two ways. First, fit an exponential trend to the series. Second, use Holts method with optimized smoothing constants. b. Which of these two methods appears to provide the best forecasts? Answer by comparing their MAPE values.arrow_forwardScenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing expenditures for packaging materials with Jeff Joyner. Ben was particularly disturbed about the amount spent on corrugated boxes purchased from Southeastern Corrugated. Ben said, I dont like the salesman from that company. He comes around here acting like he owns the place. He loves to tell us about his fancy car, house, and vacations. It seems to me he must be making too much money off of us! Jeff responded that he heard Southeastern Corrugated was going to ask for a price increase to cover the rising costs of raw material paper stock. Jeff further stated that Southeastern would probably ask for more than what was justified simply from rising paper stock costs. After the meeting, Ben decided he had heard enough. After all, he prided himself on being a results-oriented manager. There was no way he was going to allow that salesman to keep taking advantage of Coastal Products. Ben called Jeff and told him it was time to rebid the corrugated contract before Southeastern came in with a price increase request. Who did Jeff know that might be interested in the business? Jeff replied he had several companies in mind to include in the bidding process. These companies would surely come in at a lower price, partly because they used lower-grade boxes that would probably work well enough in Coastal Products process. Jeff also explained that these suppliers were not serious contenders for the business. Their purpose was to create competition with the bids. Ben told Jeff to make sure that Southeastern was well aware that these new suppliers were bidding on the contract. He also said to make sure the suppliers knew that price was going to be the determining factor in this quote, because he considered corrugated boxes to be a standard industry item. Is Ben Gibson acting legally? Is he acting ethically? Why or why not?arrow_forward
- Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing expenditures for packaging materials with Jeff Joyner. Ben was particularly disturbed about the amount spent on corrugated boxes purchased from Southeastern Corrugated. Ben said, I dont like the salesman from that company. He comes around here acting like he owns the place. He loves to tell us about his fancy car, house, and vacations. It seems to me he must be making too much money off of us! Jeff responded that he heard Southeastern Corrugated was going to ask for a price increase to cover the rising costs of raw material paper stock. Jeff further stated that Southeastern would probably ask for more than what was justified simply from rising paper stock costs. After the meeting, Ben decided he had heard enough. After all, he prided himself on being a results-oriented manager. There was no way he was going to allow that salesman to keep taking advantage of Coastal Products. Ben called Jeff and told him it was time to rebid the corrugated contract before Southeastern came in with a price increase request. Who did Jeff know that might be interested in the business? Jeff replied he had several companies in mind to include in the bidding process. These companies would surely come in at a lower price, partly because they used lower-grade boxes that would probably work well enough in Coastal Products process. Jeff also explained that these suppliers were not serious contenders for the business. Their purpose was to create competition with the bids. Ben told Jeff to make sure that Southeastern was well aware that these new suppliers were bidding on the contract. He also said to make sure the suppliers knew that price was going to be the determining factor in this quote, because he considered corrugated boxes to be a standard industry item. As the Marketing Manager for Southeastern Corrugated, what would you do upon receiving the request for quotation from Coastal Products?arrow_forwardThe Baker Company wants to develop a budget to predict how overhead costs vary with activity levels. Management is trying to decide whether direct labor hours (DLH) or units produced is the better measure of activity for the firm. Monthly data for the preceding 24 months appear in the file P13_40.xlsx. Use regression analysis to determine which measure, DLH or Units (or both), should be used for the budget. How would the regression equation be used to obtain the budget for the firms overhead costs?arrow_forwarda. Compute a three-week moving average forecast for the arrival of medical clinic patients in week 4. The numbers of arrivals for the past 3 weeks were as follows: Week Patient Arrivals1 4002 3803 411 b. If the actual number of patient arrivals in week 4 is 415, what is the forecast error for week 4?c. What is the forecast for week 5?arrow_forward
- Corporate triple-A bond interest rates for 12 consecutive months follow. Month 1 2 3 4 5 6 7 8 9 10 11 12 Value 9.5 9.3 9.4 9.6 9.8 9.7 9.8 10.5 9.9 9.7 9.6 9.6 a. Construct a time series plot. What type of pattern exists in the data? b. Develop the three-month moving averages for this time series. Compute MSE. c. Compute MAE. d. Compute MAPE. e. What is the three-month moving average forecast for the next month (month 13)?arrow_forwarda. Using the following, forecast the sales for the months up to January the following year:-i. A simple three month moving average.ii. A three period weighted moving average using weights of 1, 2 and 3. Assign the highest weight to the most recent data. iii. Exponential Smoothing when α= .6 and the forecast for March is 350.iv. Determine which of the three forecasting technique is the most accurate using MAD.arrow_forwardUsing naïve method to make a forecast involving data with trend, the forecasted sales volume for week 4 must be ________ units if the actual sales are 500, 510, and 508 in weeks 1, 2, & 3, respectively: * o 506 o 508 o 510 o 500arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
Practical Management ScienceOperations ManagementISBN:9781337406659Author:WINSTON, Wayne L.Publisher:Cengage,
Purchasing and Supply Chain ManagementOperations ManagementISBN:9781285869681Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. PattersonPublisher:Cengage Learning
Contemporary MarketingMarketingISBN:9780357033777Author:Louis E. Boone, David L. KurtzPublisher:Cengage Learning
MarketingMarketingISBN:9780357033791Author:Pride, William MPublisher:South Western Educational Publishing
Practical Management Science
Operations Management
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:Cengage,
Purchasing and Supply Chain Management
Operations Management
ISBN:9781285869681
Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:Cengage Learning
Contemporary Marketing
Marketing
ISBN:9780357033777
Author:Louis E. Boone, David L. Kurtz
Publisher:Cengage Learning
Marketing
Marketing
ISBN:9780357033791
Author:Pride, William M
Publisher:South Western Educational Publishing
Forecasting 2: Forecasting Types & Qualitative methods; Author: Adapala Academy & IES GS for Exams;https://www.youtube.com/watch?v=npWni9K6Z_g;License: Standard YouTube License, CC-BY
Introduction to Forecasting - with Examples; Author: Dr. Bharatendra Rai;https://www.youtube.com/watch?v=98K7AG32qv8;License: Standard Youtube License