Bida650 homework I

see file

BIDA 650 Business Analytics HW #1

Question 1. (100 points) The OFLT Trucking Company needs to determine whether they would

increase their fleet size or not. Since their ultimate objective is to satisfy the certain percentage of

nationwide transportation demand, they obtained the following data representing total

transportation demand in billions of dollars. (You can copy tables into Excel)

Table 1. Demand for transportation
Year Total transportation demand

1980 332.6

1985 486.4

1990 598.3

1991 595.8

1992 638.0

1993 682.7

1994 742.0

1995 772.1

1996 828.1

1997 896.4

1998 931.1

1999 1,009.4

2000 1,059.9

2001 1,052.6

2002 1,075.4

2003 1,097.3

2004 1,160.5

2005 1,248.2

2006 1,312.4

2007 1,391.1

2008 1,359.7

2009 1,175.6

2010 1,320.2

2011 1,467.1

2012 1,560.5

2013 1,608.0

2014 1,661.1

2015 1,630.6

2016 1690.5
Source: U.S. Department of Commerce, Bureau of Economic Analysis

a) Plot the time series data and comment on the pattern you observe.
b) Use weighted moving average method to forecast the demand for 2017.
c) Use exponential smoothing with optimal α to forecast the demand for 2017.

d) Use regression method to forecast the demand for 2017-2020.
e) Compute the following measures of forecast accuracy: mean absolute error, mean

squared error, mean absolute percentage error for your forecasts in parts b, c and d.

f) Determine the most accurate forecast method and estimate the demand for 2017.

Rubric:

Each is (15 points) except part e and f each is (20 points)

Dr. Majed