New 662 - Question II The actual demand for the patients at...

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Question: II. The actual demand for the patients at Omaha Emergency Medical Clinic for the first nine weeks of this year are as follows: Week Actual # of Patients Forecast 1 78 2 65 3 90 4 71 5 101 6 88 7 60 8 73 a) Compute a simple exponential smoothing forecast for week 9 with α=.5. Assume the forecast for week 1 is 74 Answer: Forecast as per exponential smoothing: This can be written as: St +1= St + α t ϵ , where t ϵ is the forecast error (actual - forecast) for period t . In other words, the new forecast is the old one plus an adjustment for the error that occurred in the last forecast. Forecast for week 2 = Forecast for week 1 + (Actual of week 1 - Forecast of week 1) x a = 74 + (78 - 74) x 0.50 = 76 Similarly other calculations are shown below: Week Actual Forecast 1 78 74.00 2 65 76.00 3 90 70.50 4 71 80.25 5 101 75.63 6 88 88.31 7 60
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Unformatted text preview: 8 73 74.08 9 73.54 So, forecas± for week 9 = 73.54 Queston: In performing a horizon±al analysis on a company's income s±a±emen±, you notce ±ha± sales have decreased by 4%, bu± ±he gross proF± has increased by 10%. Wha± are some fac±ors ±ha± could cause ±his ±o happen? Answer: Gross profit = Sales - Cost of Goods Sold. So, if sales has fallen by 4%, but Gross profit has increased by 10%, it means the Cost of Goods Sold has fallen. The cost of Inputs used by the organization has fallen due to which the Gross profit has risen even after a fall in Sales. Another factor could be efficiency. The organization may have employed efficient techniques due to which the quantity of input of the wastage has reduced which has resulted into fall in Cost of Goods Sold....
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