Question

The manager of a travel agency has been using a seasonally adjusted forecast to predict demand for packaged tours. The actual and predicted values are as follows:

Period	Demand	Predicted
1	123	113
2	183	200
3	143	150
4	78	102
5	73	80
6	118	135
7	113	128
8	142	124
9	107	109
10	162	150
11	117	94
12	102	80
13	137	140
14	147	128

a. Compute MAD for the fifth period, then update it period by period using exponential smoothing with α = .10. FILL IN THE BLANKS. (Round your intermediate calculations and final answers to 3 decimal places.)

t Period	A Demand	MADt
1	123
2	183
3	143
4	78
5	73	13
6	118	13.4
7	113
8	142
9	107
10	162
11	117
12	102
13	137
14	147

b. Compute a tracking signal for periods 5 through 14 using the initial and updated MADs.FILL IN THE BLANKS (Negative values should be indicated by a minus sign. Round your intermediate calculations and final answers to 3 decimal places.)

t Period	A Demand	tracking signal
1	123
2	183
3	143
4	78
5	73
6	118
7	113
8	142
9	107
10	162
11	117
12	102
13	137
14	147

Answer 1

a.

Period - t	Demand	Predicted	|et|	MADt = α.|et|+ (1 - α).MADt-1
1	123	113	10
2	183	200	17
3	143	150	7
4	78	102	24
5	73	80	7	13.000
6	118	135	17	13.400
7	113	128	15	13.560
8	142	124	18	14.004
9	107	109	2	12.804
10	162	150	12	12.723
11	117	94	23	13.751
12	102	80	22	14.576
13	137	140	3	13.418
14	147	128	19	13.976

b.

Period - t	Demand	Predicted	et	RSFE	TS = RSFE / MAD
1	123	113	10	10
2	183	200	-17	-7
3	143	150	-7	-14
4	78	102	-24	-38
5	73	80	-7	-45	-3.462
6	118	135	-17	-62	-4.627
7	113	128	-15	-77	-5.678
8	142	124	18	-59	-4.213
9	107	109	-2	-61	-4.764
10	162	150	12	-49	-3.851
11	117	94	23	-26	-1.891
12	102	80	22	-4	-0.274
13	137	140	-3	-7	-0.522
14	147	128	19	12	0.859

Calculations:

Н 1. MAD; = a.Je|+ (1 - a).MAD1 lel TS = RSFE / MAD Period -t Demand Predicted 2 RSFE e, =ABS(E3) 3 123 113 =C3-D3 =E3 183 =C4-D4 =ABS(E4) 4 200 =E4+H3 =ABS(E5) 5 143 150 =C5-D5 =E5+H4 =ABS(E6) 78 102 =C6-D6 =E6+H5 =E7+H6 =AVERAGE(F3:F7) =0.1*F8+(1-0.1)*G7 =H7/G7 |=ABS(E7) 73 80 =C7-D7 -н8/68 118 =ABS(E8) =E8+H7 135 =C8-D8 н9/69 |=ABS(E9) |=0.1*F9+(1-0.1)*G8 113 128 =C9-D9 =E9+H8 =H10/G10 =C10-D10 |=ABS(E10) |=0.1*F10+(1-0.1)*G9 10 8. 142 124 =E10+H9 =H11/G11 =C11-D11 =ABS(E11) =0.1*F11+(1-0.1)*G10 =E11+H10 11 107 109 =H12/G12 =C12-D12 =ABS(E12) |=0.1*F12+(1-0.1)*G11 12 10 162 150 =E12+H11 =ABS(E13) =0.1*F13+(1-0.1)*G12 =H13/G13 13 11 117 94 =C13-D13 =E13+H12 =H14/G14 =C14-D14 =ABS(E14) =ABS(E15) =0.1*F14+(1-0.1)*G13 14 12 102 80 =E14+H13 =H15/G15 137 |=0.1*F15+(1-0.1)*G14 15 13 140 =C15-D15 =E15+H14 =H16/G16 =ABS(E16) |=0.1*F16+(1-0.1)*G15 16 14 147 128 =C16-D16 =E16+H15 ш 3.