Question
64) The last four weekly values of sales were 80, 100, 105, and 90 units, respectively. The last four forecasts (for the same four weeks) were 60, 80, 95, and 75 units, respectively. Calculate the MAD, MSE, and MAPE for these four weeks.
Sales 
Forecast 
Error 
Error squared 
Pct. error 
80 
60 
20 
400 
.25 
100 
80 
20 
400 
.20 
105 
95 
10 
100 
.095 
90 
75 
15 
225 
.167 
65) A management analyst is using exponential smoothing to predict merchandise returns at an upscale branch of a department store chain. Given an actual number of returns of 154 items in the most recent period completed, a forecast of 172 items for that period, and a smoothing constant of 0.3, what is the forecast for the next period? How would the forecast be changed if the smoothing constant were 0.6? Explain the difference in terms of alpha and responsiveness.
66) The following trend projection is used to predict quarterly demand: yhat = 250  2.5x, where x = 1 in the first quarter. Seasonal (quarterly) indices are Quarter 1 = 1.5; Quarter 2 = 0.8; Quarter 3 = 1.1; and Quarter 4 = 0.6. What is the seasonally adjusted forecast for the next four quarters?
67) Favors Distribution Company purchases small imported trinkets in bulk, packages them, and sells them to retail stores. The managers are conducting an inventory control study of all their items. The following data are for one such item, which is not seasonal.
a. Use a trend projection to estimate the relationship between time and sales (state the equation).
b. Calculate forecasts for the first four months of the next year.

1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
Month 
Jan 
Feb 
Mar 
Apr 
May 
Jun 
Jul 
Aug 
Sep 
Oct 
Nov 
Dec 
Sales 
51 
55 
54 
57 
50 
68 
66 
59 
67 
69 
75 
73 