Develop a forecast for this data using simple exponential smoothing with an alpha of 0.66. Then calculate MAD, MSE and the tracking signal
What will be an ideal response?
Answer: The forecast, forecast error, absolute deviation, bias and tracking signal appear in the table.
Period Forecast Error Abs Error Bias TS
1 176.6 3.6 3.6 3.6 1.00
2 174.2 -2.8 2.8 0.8 0.26
3 176.1 -3.9 3.9 -3.1 -0.91
4 178.7 27.7 27.7 24.5 2.58
5 160.4 -7.6 7.6 16.9 1.86
6 165.4 -18.6 18.6 -1.6 -0.15
7 177.7 -20.3 20.3 -22.0 -1.82
8 191.1 0.1 0.1 -21.9 -2.07
9 191.0 24.0 24.0 2.2 0.18
10 175.2 -1.8 1.8 0.3 0.03
The MAD is 11.043
The MSE is 219.79
The tracking signal appears in the table.
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