The following table contains the demand from the last 10 months:
Month (M) 1- Actual Demand (AD)-31; M2-AD34; M3-AD33; M4-AD35; M5-AD37; M6-AD36; M7-AD38; M8-AD40; M9-AD40; M10=AD41.
STEP ONE: Calculate the single exponential smoothing forecast for these data using a alpha of .30, and an initial forecast of (F1) of 31.
STEP TWO: Calculate the exponential smoothing with trend forecast for these data using a alpha of .30 a delta of .30, and an initial trend forecast (T1) of 1, and an initial exponentially smoothed forecast (F1) of 30.
STEP THREE: Calculate the mean absolute deviation (MAD) for each forecast.
STEP FOUR: Which is best and explain why?
We are allowed to use excel, but it must be done by hand and not using excel functions. Please indicate Step 1, 2, 3, 4 and indicate (highlight) the final answer for each.
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