At the Rhorer Car Dealership, two salespersons deployed different forecast techniques. The Dealership's son, Joe uses exponential smoothing with alpha of 0.15; while the Sales Manager, Jack conducted focus groups,and market research. The data shown below. Determine which technique (using MAD analysis) gives a better forecast.#123456789101112|131415161718192021222324[Select][Select][Select]Month - Yr. Sales1/1/20162343453/1/20161251-Apr2595/1/2016 3152787/1/2016 40123136826811/1/2016 2141591/1/2017 2002/1/2017 3981-Feb1-Jun1-Aug9/1/20161-Oct1-Dec1-Mar4/1/2017 2504103985018/1/2017 32721910/1/2017 34820912/1/2017 2761-May6/1/20171-Jul1-Sep1991-NovJoeExpSmoothalpha 0.15234234251232236248252275268283281271254246269258257280298328328312317301JackFocusGroup269397144298362320461266423308246183240478239300492478601392263418251331What is the average error in the forecast for Joe's Exponential forecast with alpha 0.15What is the average error in the forecast for Jack's Focus Group forecast?Which is a better forecast?

Absolute Error = Sales- ForecastMAD = ∑Absolute ErrornWhere n = No. of periods

Answered: At the Rhorer Car Dealership, two…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter13: Regression And Forecasting Models

Section13.7: Exponential Smoothing Models

Problem 27P: The file P13_27.xlsx contains yearly data on the proportion of Americans under the age of 18 living...

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