Reference no: EM133052639

Discussion

Identify a situation in your life/work previously or currently (broadly defined) when you had a decision to make where the outcome of that decision was affected by another decision maker's decision.

-or-

Identify a situation in your life/work previously or currently (broadly defined) when you had a decision to make that required a forecast of a variable for which you had data going back several time periods.

Instructions:

Situation A: Using Game Theory

• Describe the situation briefly, identify the decision makers and their alternatives, and identify the payoffs. There must be at least two decision alternatives and a payoff for each pair of decision alternatives made by the two decision makers.
• Construct a payoff table. Assign a payoff for each pair of decision alternatives using data or your best estimate. The values in the table will likely be dollars or units of utility.
• Identify the optimal strategy for each decision maker. Is it a pure strategy or a mixed strategy?

Situation B: Using Forecasting

• Describe the situation briefly and identify the variable you are forecasting.
• Plot the data you have for the variable on a time series plot (scatterplot with dots connected). You must have at least 10 time periods, but you'll probably also want no more than 30. Include the graph in your discussion post. Note: if the data you want to use is sensitive, private, or proprietary, you can either not use it or change the numbers to reflect the situation, but that doesn't reveal the true values. The idea is that you are applying the method to your life.
• Identify visually evident pattern(s) in the time series plot.
• Calculate the MAE, MSE, and MAPE using the naive method and another method of your choosing: moving average, weighted moving average, linear trend, seasonality without trend, or seasonality with trend. The method should ideally match the visually evident pattern you identify. You don't need to show all of your work in the post, but report the finals values for MAE, MSE, MAPE for both methods.
• Briefly identify the method that produces the better forecast.

For Either Situation

• Respond to a classmate's post evaluating their setup and calculations. Did they do everything correctly? What suggestions, if any, would you make to improve their post? Please respond to an initial post that has yet to have a reply. You do not need to reply to post that used the same method you did. If you provided a situation using game theory, you can reply to a post using forecasting and vice versa.