Q Problem No.

1 (2009)
Following data table is available about the Actual Sales Quantities for the past 12 years.
Year 1 2 3 4 5 6 7 8 9 10 11 12
Sales 75 80 98 128 137 119 102 104 100 102 82 73
Find the forecast for the year 13 using Five Years as well as Four Years moving averages. Which of the two
forecasts is more reliable using MSE criterion?

As Per 4 Year Moving Average As Per 5 Year Moving Average

Year Sales Ft (At-Ft)^2 Year Sales Ft (At-Ft)^2
1 75 1 75
2 80 2 80
3 98 3 98
4 128 4 128
5 137 95.25 1743.063 5 137
6 119 110.75 68.0625 6 119 103.6 237.16
7 102 120.5 342.25 7 102 112.4 108.16
8 104 121.5 306.25 8 104 116.8 163.84
9 100 115.5 240.25 9 100 118 324
10 102 106.25 18.0625 10 102 112.4 108.16
11 82 102 400 11 82 105.4 547.56
12 73 97 576 12 73 98 625
13 89.25 13 92.2

Total 3693.938 Total 2113.88

MSC 461.7422 MSC 301.9829
ges. Which of the two
Q Problem No. 2 (2013)
Following data is available about, actual sales quantities for the past 14 years.
Year 1 2 3 4 5 6 7 8 9 10 11 12 13 14
Sales 46 44 40 45 52 66 70 82 76 80 86 84 96 104
Find the forecast value for year 15 using Three Years as well as Four Years Moving Average. Which of the two
forecasts is more reliable on the basis of MSE criterion?

As Per 3 Years Moving Average As Per 4 Years Moving Average

Year Sales Ft (At-Ft)^2 Year Sales Ft (At-Ft)^2
1 46 1 46
2 44 2 44
3 40 3 40
4 45 43.33 2.78 4 45
5 52 43.00 81.00 5 52 43.75 68.06
6 66 45.67 413.44 6 66 45.25 430.56
7 70 54.33 245.44 7 70 50.75 370.56
8 82 62.67 373.78 8 82 58.25 564.06
9 76 72.67 11.11 9 76 67.50 72.25
10 80 76.00 16.00 10 80 73.50 42.25
11 86 79.33 44.44 11 86 77.00 81.00
12 84 80.67 11.11 12 84 81.00 9.00
13 96 83.33 160.44 13 96 81.50 210.25
14 104 88.67 235.11 14 104 86.50 306.25
15 94.67 15 92.50

Total 1594.67 Total 2154.25

MSC 144.9697 MSC 215.425
age. Which of the two
Q Problem No. 3 (2012)
Following data table is available about the Actual Sales Quantities for the past 12 years.
Year 1 2 3 4 5 6 7 8 9 10 11 12
Sales 225 240 294 384 411 357 306 312 300 306 246 219
Find the forecast for the year 13 using Five Years as well as Four Years moving averages. Which of the two
forecasts is more reliable using MSE criterion?

As Per 4 Year Moving Average As Per 5 Year Moving Average

Year Sales Ft (At-Ft)^2 Year Sales Ft (At-Ft)^2
1 225 1 225
2 240 2 240
3 294 3 294
4 384 4 384
5 411 285.75 15687.56 5 411
6 357 332.25 612.5625 6 357 310.8 2134.44
7 306 361.5 3080.25 7 306 337.2 973.44
8 312 364.5 2756.25 8 312 350.4 1474.56
9 300 346.5 2162.25 9 300 354 2916
10 306 318.75 162.5625 10 306 337.2 973.44
11 246 306 3600 11 246 316.2 4928.04
12 219 291 5184 12 219 294 5625
13 267.75 13 276.6

Total 33245.44 Total 19024.92

MSC 4155.68 MSC 2717.846
ges. Which of the two
Q Problem No. 4 (2010)
Following data table is available about the Actual Sales Quantities for the past 10 years.
Year 1 2 3 4 5 6 7 8 9 10
Sales 330 320 300 340 330 360 400 340 380 420
Find the forecast for the year 11 using Two Years as well as Three Years moving averages. Which of the two
forecasts is more reliable using MSE criterion?

As Per 2 Year Moving Average As Per 3 Year Moving Average

Years Sales Ft (At-Ft)^2 Years Sales Ft (At-Ft)^2
1 330 1 330
2 320 2 320
3 300 325 625 3 300
4 340 310 900 4 340 316.67 544.44
5 330 320 100 5 330 320.00 100.00
6 360 335 625 6 360 323.33 1344.44
7 400 345 3025 7 400 343.33 3211.11
8 340 380 1600 8 340 363.33 544.44
9 380 370 100 9 380 366.67 177.78
10 420 360 3600 10 420 373.33 2177.78
11 400 11 380.00

Total 10575 Total 8100

MSC 1321.875 MSC 1157.143
ages. Which of the two
Q Problem No. 5 (2008)
Following data table is available about the Actual Sales Quantities for the past 12 years.
Year 1 2 3 4 5 6 7 8 9 10 11 12
Sales 40 45 35 30 40 50 55 60 65 50 45 50
Find the forecast for the year 13 using Five Years as well as Four Years moving averages. Which of the two
forecasts is more reliable using MSE criterion?

As Per 4 Year Moving Average As Per 5 Year Moving Average

Year Sales Ft (At-Ft)^2 Year Sales Ft (At-Ft)^2
1 40 1 40
2 45 2 45
3 35 3 35
4 30 4 30
5 40 37.5 6.25 5 40
6 50 37.5 156.25 6 50 38 144
7 55 38.75 264.06 7 55 40 225
8 60 43.75 264.06 8 60 42 324
9 65 51.25 189.06 9 65 47 324
10 50 57.5 56.25 10 50 54 16
11 45 57.5 156.25 11 45 56 121
12 50 55 25.00 12 50 55 25
13 52.5 13 54

Total 1117.188 Total 1179

MSC 139.6484 MSC 168.4286
ges. Which of the two
Q Problem No. 6 (2006)
Following data table is available about the Actual Sales Quantities for the past 10 years.
Year 1 2 3 4 5 6 7 8 9 10
Sales 230 220 200 240 230 260 300 240 280 320
Find the forecast for the year 11 using Two Years as well as Three Years moving averages. Which of the two
forecasts is more reliable using MSE criterion?

As Per 2 Year Moving Average As Per 3 Year Moving Average

Years Sales Ft (At-Ft)^2 Years Sales Ft (At-Ft)^2
1 230 1 230
2 220 2 220
3 200 225 625 3 200
4 240 210 900 4 240 216.67 544.44
5 230 220 100 5 230 220.00 100.00
6 260 235 625 6 260 223.33 1344.44
7 300 245 3025 7 300 243.33 3211.11
8 240 280 1600 8 240 263.33 544.44
9 280 270 100 9 280 266.67 177.78
10 320 260 3600 10 320 273.33 2177.78
11 300 11 280.00

Total 10575 Total 8100

MSC 1321.875 MSC 1157.143
ages. Which of the two
Q Problem No. 7
The demand for a particular item during the 12 months of a year is as given in table below. The manager is
considering how well the exponential smoothing serves as an appropriate technique in forecasting the demand
of the item. Five values of the smoothing constant α, 0.1, 0.2, 0.3, 0.5 & 0.8 are considered. Calculate the
forecasted values using each of the five values of the smoothing constant if the initial forecast (Fo) is 208. Also
calculate Mean Absolute Deviation (MAD) for the five series of estimates and suggest which one is most
appropriate on the basis of least mean absolute divisions.
Year 1 2 3 4 5 6 7 8 9 10 11 12
DD 213 201 198 207 220 232 210 217 212 225 221 228

Alpha 0.1 Alpha 0.2 Alpha 0.3

Year Series Ft (At-Ft)^2 Year Series Ft (At-Ft)^2 Year Series
1 213 208 25.00 1 213 208 25.00 1 213
2 201 208.50 56.25 2 201 209.00 64.00 2 201
3 198 207.75 95.06 3 198 207.40 88.36 3 198
4 207 206.78 0.05 4 207 205.52 2.19 4 207
5 220 206.80 174.31 5 220 205.82 201.19 5 220
6 232 208.12 570.36 6 232 208.65 545.09 6 232
7 210 210.51 0.26 7 210 213.32 11.04 7 210
8 217 210.46 42.83 8 217 212.66 18.85 8 217
9 212 211.11 0.79 9 212 213.53 2.33 9 212
10 225 211.20 190.47 10 225 213.22 138.75 10 225
11 221 212.58 70.91 11 221 215.58 29.41 11 221
12 228 213.42 212.55 12 228 216.66 128.56 12 228
13 214.88 13 218.93 13
 below. The manager is
e in forecasting the demand
sidered. Calculate the
al forecast (Fo) is 208. Also
st which one is most

Alpha 0.5 Alpha 0.8

Ft (At-Ft)^2 Year Series Ft (At-Ft)^2 Year Series Ft (At-Ft)^2
208 25.00 1 213 208 25.00 1 213 208 25.00
209.50 72.25 2 201 210.50 90.25 2 201 212.00 121.00
206.95 80.10 3 198 205.75 60.06 3 198 203.20 27.04
204.27 7.48 4 207 201.88 26.27 4 207 199.04 63.36
205.09 222.44 5 220 204.44 242.19 5 220 205.41 212.93
209.56 503.56 6 232 212.22 391.30 6 232 217.08 222.56
216.29 39.59 7 210 222.11 146.64 7 210 229.02 361.62
214.40 6.74 8 217 216.05 0.89 8 217 213.80 10.22
215.18 10.13 9 212 216.53 20.50 9 212 216.36 19.02
214.23 116.03 10 225 214.26 115.27 10 225 212.87 147.09
217.46 12.53 11 221 219.63 1.87 11 221 222.57 2.48
218.52 89.84 12 228 220.32 59.05 12 228 221.31 44.69
221.37 13 224.16 13 226.66
Q Problem No. 8
An initial forecast for the given series is known and is 28. If the exponential smoothing constant, α = 0.1, find
the forecast for the 9 th period.
Year 1 2 3 4 5 6 7 8
Series 30 30 23 28 25 24 29 25

Alpha 0.1
Year Series (At) Ft (At-Ft)^2
1 30 28.00 4
2 30 28.20 3.24
3 23 28.38 28.9444
4 28 27.84 0.024964
5 25 27.86 8.167021
6 24 27.57 12.75933
7 29 27.21 3.186875
8 25 27.39 5.728058
27.15
onstant, α = 0.1, find
Q Problem No. 9
An initial forecast for the given series is known and is 30. If the exponential smoothing constant, α = 0.2, find
the forecast of sales for the 9 th period using the data available. Is this method better than moving averages
method using 3 period moving average? Justify your argument by calculating MSE for both the methods.
Year 1 2 3 4 5 6 7 8
Series 32 34 25 28 24 22 29 25

Alpha 0.2
Year Series (At) Ft (At-Ft)^2
1 32 30.00 4
2 34 30.40 12.96
3 25 31.12 37.4544
4 28 29.90 3.594816
5 24 29.52 30.43508
6 22 28.41 41.13221
7 29 27.13 3.494088
8 25 27.50 6.273029
27.00
 constant, α = 0.2, find
than moving averages
both the methods.