Answered Essay: Sales of​ Volkswagen's popular Beetle have grown steadily at auto dealerships in Nevada during the past 5 years​ (see table​ below)

Sales of​ Volkswagen’s popular Beetle have grown steadily at auto dealerships in Nevada during the past 5 years​ (see table​ below).

Year   Sales
1 450
2 502
3 516
4 570
5 585

a) Forecasted sales for year 6 using a​ 3-year moving average is _____ sales​ (round your response to one decimal​ place).

​b) The MAD for a​ 3-year moving average based forecast is _____ sales ​(round your response to one decimal​ place).

​c) The MSE for a​ 3-year moving average based forecast is ______sales ​(round your response to the nearest whole​ number).

Expert Answer

 

A) For year 4 forecast = (450+502+516)/3 = 489.3

For year 5 forecast = ( 502+516+570)/3 = 529.3

For year 6 forecast =(516+570+585)/3 =557

B) deviation for year 4= 570-489.3 = 80.7

Deviation for year 5= 585-529.3 = 55.7

MAD= (55.7+80.7)/2 = 68.2

C)MSE= (80.7)^2 + (55.7)^2 /2 = 6512.5 + 3102.5/2 = 4807.5

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