Assignment:
QUESTION 1
Assume that the data set is time series data of monthly sales. Answer questions (a) and (b) below.
(a) What is the forecast equation in the form of Y = a + bX + error ?
(b) Construct the upper and lower forecast values and show how does (Y ± error) differ from X(obs)?
QUESTION 2
Assume that the data set is non-time series.
Answer questions (a) and (b) below.
(a) What is the forecast value?
(b) What is the error level under the following methods?
(i) SD,
(ii) MAD
(iii) MAPE
(c) Which error method is better forecast if the data set represents:
(i) inventory stock to serve customers and
(ii) quality standard seeking minimal level of error