Reference no: EM13334217
Among other services and products that Karl's Copiers provides, it sells and repairs photocopy machines. It is now the end of December, 2014 and the manager needs to plan his service staffing for January, 2015. The manager first needs to forecast the number of service calls for January, 2015. Following are the record of service calls for the past 12 months.
|
Month
|
Number of Service Calls
|
Month
|
Number of Service Calls
|
|
January
|
30
|
July
|
31
|
|
February
|
24
|
August
|
38
|
|
March
|
27
|
September
|
37
|
|
April
|
31
|
October
|
36
|
|
May
|
37
|
November
|
32
|
|
June
|
34
|
December
|
29
|
You have been asked by the manager to help with the forecast for January, 2015. He has asked you to provide forecasts for January using the following three methods:
- Moving Average
- Weighted Moving Average
- Exponential Smoothing
He has also asked you to determine which of these three forecasts he should select. To make this assessment, he has asked that you compare the actual number of service calls to what the forecasts would have been for September through December, 2014 using each of the three methods.
i) For the moving average, use a three month moving average.
ii) For the weighted moving average, use a two-period weighted average with a weight of 0.70 for the most recent month and the remaining weight(s) consistent with this forecasting method as we applied it.
iii) For exponential smoothing, use an α = 0.25, and using a starting forecast for July, 2014 of 33.
a) Prepare a forecast for January, 2015 using each of the three methods.
b) Recommend which of these three methods the manager should use for January, 2015 based on the results of evaluation of the forecasts for September through December. Your selection criteria must be based on one of the numerical evaluation methods we have learned and used this semester. Only saying "it is the easier method" is not acceptable.