Question

Two different forecasting techniques (F1 and F2) were used to forecast demand for cases of bottled water. Note: It doesn't matter what forecasting method was used. This problem is simply to practice with MAD and MAPE! Actual demand and the two sets of forecasts are as follows: Period PREDICTED DEMAND F2 67 60 Demand 68 F1 75 67 67 71 70 69 70 74 69 72 72 77 71 77 80 78 70 72 75 75 83 a. Compute MAD for each set of forecasts. Given your results, which forecast appears to be more accurate? (Round your answers to 2 decimal place.) MAD F1 MAD F2 (Click to select) Dappears to be more accurate.

Answer 1

a.

MAD F1	3.75
MAD F2	5.13

F1 appears to be more accurate

b.

MAPE F1	4.98
MAPE F2	7.04

F1 appears to be more accurate

Calculation

C G H A B Demand F1 1 68 75 D Error 1 Period I Abs(Error) (Abs(Error)/Demand)*100 8 8 11.76470588 10.66666667 1 60 67 CO E Abs(Error) (Abs(Error)/Demand)*100 F2 1.470588235 10.66666667 1.428571429 6.756756757 1 2.898550725 2.777777778 700 72 CO NO COCO cown ú U Ú O NO COCO U w coNNU 5 5 co N 77 75 83 10 2.702702703 11.5942029 6.944444444 6.25 6.41025641 - 5 -5 5 5 w 3.846153846 10 11 MAD F1 12 MAD F2 3.75 5.13 13 14 MAPE F1 15 MAPE F2 16 4.98 7.04

Formula

C Demand 1 Period 2 1 32 4 3 5 4 6 5 D Error =B2-C2 =B3-C3 =B4-C4 =B5-C5 =B6-C6 =B7-C7 =B8-C8 =B9-C9 E Abs(Error) -ABS(D2) =ABS(D3) =ABS(D4) =ABS(D5) =ABS(D6) =ABS(D7) =ABS(D8) -ABS(19) (Abs(Error)/Demand)*100 =(E2/B2)*100 =(E3/B3)*100 =(E4/B4)*100 =(E5/B5)*100 =(E6/B6) *100 = (E7/B7)*100 =(E8/88)*100 =(E9/B9)*100 Error =B2-G2 =B3-G3 =B4-G4 =B5-65 =B6-G6 =B7-G7 =B8-G8 =B9-69 Abs(Error) =ABS(H2) =ABS(H3) =ABS(H4) =ABS(H5) =ABS(H6) =ABS(17) =ABS(H8) =ABS(H9) (Abs(Error)/Demand)*100 =(12/B2)*100 =(13/B3)*100 =(14/B4)*100 =(15/B5)*100 =(16/16)*100 =(17/B7) *100 =(18/88)*100 = (19/B9) *100 8 7 9 8 10 11 MAD F1 12 MAD F2 13 14 MAPE F1 15 MAPE F2 16 =ROUND(AVERAGE(E2:E9),2) =ROUND(AVERAGE(12:19),2) =ROUND(AVERAGE(F2:F9),2) =ROUND(AVERAGE(12:19),2)