Compute the rsfe and tracking signals

Question

The following problems should be solved using QM for Windows & Excel.

Question 1: Sale of industrial vacuum cleaners at R. Lowenthal Supply Co. over the past 13 months are as follows:

Sales (1,000)       Month                             Sales (1,000s)          Month

        11              January                                       14                August

         14              February                                     17                September

         16              March                                         12                October

         10              April                                           14                November

         15              May                                            16                December

         17              June                                            11                January

         11              July

(a) Using a moving average with three periods, determine the demand for vacuum cleaners for next February.

(b) Using a weighted moving average with three periods, determine the demand for vacuum cleaners for February. Use 3, 2, and 1 for the weights of the most recent, second most recent, and third most recent periods, respectively. For example, if you were forecasting the demand for February, November would have a weight of 1, December would have a weight of 2, and January would have a weight of 3.

(c) Evaluate the accuracy of each of these methods.

(d) What other factors might R. Lowenthal consider in forecasting sales?

Question 2: Passenger miles flown o Northeast Airlines, a commuter firm serving the Boston hub, are as follows for the past 12 weeks:

                      Actual Passenger                                Actual Passenger

Weeks             Miles(1000s)                 Weeks               Miles(1000s)

   1                            17                              7                      20

   2                            21                              8                      18

   3                            19                              9                      22

   4                            23                            10                      20

   5                            18                            11                      15

   6                            16                            12                      22

(a) Assuming an initial forecast for week 1 of 17,000 miles use exponential smoothing to compute miles for weeks 2 through 12. Use a = 0.2

(b) What is the MAD for this model?

(c) Compute the RSFE, and tracking signals. Are they within acceptable limits?

Question 3: Emergency calls to Winter Park, Florida's 911 system, for the past 24 weeks are as follow:

Week       Calls               Week       Calls                 Week         Calls

   1              50                   9              35                       17            55

   2              35                  10             20                       18            40

   3              25                  11             15                       19            35

   4              40                  12             40                       20            60

   5              45                  13             55                       21            75

   6              35                  14             35                       22            50

   7              20                  15             25                       23            40

   8              30                  16             55                       24            65

(a) Compute the exponentially smoothed forecast of calls for each week. Assume an initial forecast of 50 calls in the first week and use a = 0.1. What is the forcast for the 25^th week?

(b) Forecast each period using a = 0.6.

(c) Actual calls during the 25^th week were 85. Which smoothing constraints provide a superior forecast?