Assignment:
Problem: As you can see in the following table, demand for heart transplant surgery at Washington General Hospital has increased steadily in the past few years:
Year Heart Transplats
1 45
2 50
3 52
4 56
5 58
6 ?
The director of medical services predicted 6 years ago that demand in year 1 would be 41 surgeries.
a. Use exponential smoothing, first with a smoothing constant of 0.6 and then with one of 0.9, to develop forecasts for years 2 through 6.
b. Use a 3- year moving average to forecast demand in years 4, 5, and 6.
c. Use the trend- projection method to forecast demand in years 1 through 6.
d. With MAD as the criterion, which of the four forecasting methods is best?