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Use exponential smoothing with a smoothing constant of 0.3 to forecast the registrations at the seminar given in Problem. To begin the procedure, assume that the forecast for year 1 was 5,000 people signing up.
a) What is the MAD?
b) What is the MSE?
Problem - Data collected on the yearly registrations for a Six Sigma seminar at the Quality College are shown in the following table:
YEAR
1
2
3
4
5
6
7
8
9
10
11
REGISTRATIONS (000)
12
14
15
a) Develop a 3-year moving average to forecast registrations from year 4 to year 12.
b) Estimate demand again for year's 4 to 12 with a 3-year weighted moving average in which registrations in the most recent year are given a weight of 2, and registrations in the other 2 years are each given a weight of 1.
c) Graph the original data and the two forecasts. Which of the two forecasting methods seems better?
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