Q. 1. Sales of vegetable dehydrators at Bud Baniss discount department store in St. Louis over the past year are shown below. Management prepared a forecast using a combination of exponential smoothing and its collective judgment for the 4 months (March, April, May and June of 2010):
Month2009-2010 Unit Sales Managements Forecast
July100
August93
September96
October110
November124
December119
January92
February83
March101120
April 96114
May 89110
June108108
a) Calculate MAD and MAPE for managements technique.
b) Do managements results outperform (i.e., have smaller MAD and MAPE than) a naive forecast?
c) Which forecast do you recommend, based on lower forecast error?