WHAT TO DO: As a first step in the teams decision making, you should forecast the quarterly demand for
each of the two types of containers for the years 2010 to 2012.
Based on historical trends, demand is expected
to continue to grow until 2012, after which it expected to plateau.
Julie must select the appropriate forecasting
method and estimate the likely forecast error.
Use the following methods to forecast quarterly demand for the years 2010 to 2012 in EXCEL:
(a) Moving Average
(b) Exponential Smoothing method
(c) Exponential Smoothing with Trend
(d) Time Series Decomposition
(e) For parts (a), (b) and (c), also compute the:
forecasting errors (MAD, MSE, MAPE).
standard error of forecast (SF), Bias and Tracking Signal,
also assuming normally distributed forecast errors, 90% confidence range for the 2010-2012
, using 90% = 1.
(f) Which method should she choose? Why? Explain by typing your answer in the EXCEL file
Hint: Plot of the quarterly demand (versus time) for clear and black plastic containers will
help you to determine on the forecasting method.
WHAT TO SUBMIT: One of the team members should submit a SINGLE EXCEL file (.
xls OR .
including all the TEAM MEMBERS NAMES/IDs in the file through the IE341-Project2-Fall2014-EXCEL
File Submission available under Assignments in Blackboard.
Failure of submission will result in a 0 mark
for the project.
You can use the Week08-Forecasting-InClassExercise.
xlsx (under Course Materials in
Blackboard) as a template for your answer.
Note that for parts (a), (b), (c), (d), (e) and (f), you should have
separate worksheets in the same file.
No need to submit your answers as a printout (as I will only mark your
EXCEL file only.