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 1 2 3 4 5
Mileage 3,100 4,000 3,450 3,850 3,750
a) Using a 2-year moving average, the forecast for year 6 = _______miles (round your response to the nearest whole number).
b) If a 2-year moving average is used to make the forecast, the MAD based on this =______ miles (round your response to one decimal place). (Hint: You will have only 3 years of matched data.)
c) The forecast for year 6 using a weighted 2-year moving average with weights of 0.40 and 0.60 (the weight of 0.60 is for the most recent period) = ______ miles (round your response to the nearest whole number). The MAD for the forecast developed using a weighted 2-year moving average with weights of 0.40 and 0.60 = _____ miles (round your response to one decimal place). (Hint: You will have only 3 years of matched data.)
d) Using exponential smoothing with alphaα = 0.20 and the forecast for year 1 being 3,100 the forecast for year 6 = ______ miles (round your response to the nearest whole number).