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Advanced Statiistics (Masters Course) Not your average statistic course. Determine the error for each of the following forecasts. Compute MAD and MSE 3 Questions, must show all work
Unit 5 [GB513: Business Analytics]
Assignment
This assignment requires you to use Excel. Make sure to use the Assignment 5 template found in
your online course when you turn in your answers.
Question 1
Determine the error for each of the following forecasts. Compute MAD and MSE.
Period Value Forecast Error
1 202 — —
2 191 202
3
173 192
4 169 181
5 171 174
6 175 172
7 182 174
8 196 179
9 204 189
10 219 198
11 227 211
Question 2
The U.S. Census Bureau publishes data on factory orders for all manufacturing, durable goods, and
nondurable goods industries. Shown here are factory orders in the United States over a 13-year
period ($ billion).
a. Use these data to develop forecasts for the years 6 through 13 using a 5-year moving average.
b. Use these data to develop forecasts for the years 6 through 13 using a 5-year weighted
moving average. Weight the most recent year by 6, the previous year by 4, the year before that
by 2, and the other years by 1.
c. Compute the errors of the forecasts in parts (a) and (b) and then the MAD. Which forecast is
better?
Unit 5 [GB513: Business Analytics]
Year Factory Orders ($ billion)
1 2,512.7
2 2,739.2
3 2,874.9
4 2,934.1
5 2,865.7
6 2,978.5
7 3,092.4
8 3,356.8
9 3,607.6
10 3,749.3
11 3,952.0
12 3,949.0
13 4,137.0
Question 3
The “Economic Report to the President of the United States” included data on the amounts of
manufacturers’ new and unfilled orders in millions of dollars. Shown here are the figures for new
orders over a 21-year period. Use Excel to develop a regression model to fit the trend effects for
these data. Use a linear model and then try a quadratic model. How well does either model fit the
data?
Year Total Number of New Orders
1 55,022
2 55,921
3 64,1 82
4 76,00
3
5 87,327
6 85,139
7 99,513
Unit 5 [GB513: Business Analytics]
8 115,109
9 131,629
10 147,604
11 156,359
12 168,025
13 162,140
14 175,451
15 192,879
16 195,706
17 195,204
18 209,389
19 227,025
20 240,758
21 243,643
Submit your Assignment to the Unit 5 Dropbox.
GB513 Unit 5 Assignment
Content
Points
Possible
Points
Earned
Provide error for each forecast by computing Mean
Absolute Deviation (MAD) for Q1
5
Provide error for each forecast by computing Mean
Square Error (MSE) for Q1
5
Used data in Q2 (a) to develop forecasts for the years 6
through 13 using a 5-year moving average
3
Used data in Q2 (b) to develop forecasts for the years 6
through 13 using a 5-year weighted moving average
3
Unit 5 [GB513: Business Analytics]
using weighting specified in the problem.
Computed the errors of the forecasts for Q2 (a) and the
Mean Absolute Deviation (MAD). Q.2(c)
3
Computed the errors of the forecasts for Q2 (b) and the
Mean Absolute Deviation (MAD). Q.2(c)
3
Used Excel to develop a regression model to fit the trend
effects for data in Q3.
4
Used a linear model for Q3 4
Used a quadratic model for Q3 4
Analysis
Provided a summary of the best forecast for Question 2
and justified the answer given.
5
Provided assessment of how well the models used for
Question 3 fit the data and justified the answer given.
5
Writing Skills
Spelling, Grammar, and Punctuation 6
Total 50
