Problem: The Carbondale Hospital is considering the purchase of a new ambulance. The decision will rest partly on the anticipated mileage to be driven next year. The miles driven during the past 5 years are as follows.
|
Year
|
Mileage
|
|
|
|
1
|
3,100
|
|
2
|
4,000
|
|
3
|
3,500
|
|
4
|
4,000
|
|
5
|
3,700
|
Q1. Forecast the mileage for next year using a 2-year moving average. _______
Q2. Find the MAD for your forecast in part (a). ____________
Q3. Use a weighted 2-year moving average with weights of .4 and .6 to forecast next year’s mileage. (The weight of .6 is for the most recent year.) ____________
Q4. What is the MAD of this forecast? ____________
Q5. Compute the forecast for year 6 using exponential smoothing, an initial forecast for year 1 of 3,100 miles, and _________